The Classification and Performance of Alternative Exchange-Rate Systems

By George S. Tavlas, Harris Dellas, Alan C. Stockman. Social Science Research Network, 2008

143 citations recorded by the source corpus.

Owing to dissatisfaction with the IMF's de jure classification of exchange-rate regimes, a substantial literature has emerged presenting de facto classifications of exchange-rate systems and using the latter classifications to compare performances of alternative regimes in terms of key macroeconomic variables. This paper critically reviews the literature on de facto regimes. In particular, the paper (1) describes the main methodologies that have been used to construct de facto codings, (2) surveys the empirical literature generated by de facto regime codings, and (3) lays-out the problems inherent in constructing de facto classifications. The empirical literature is found to yield few robust findings. We argue that the as-yet unfulfilled objective of this literature, and the major research agenda for the future in this area, lies in the need of a more thorough investigation of the degree of monetary-policy independence without relying exclusively on movements in exchange rates, an agenda the attainment of which is made especially challenging because of the lack of comprehensive and reliable data on reserves and interest rates.

Subfields: Development, Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/c30b38797f610e67e17d4827a56b8551983779c3

Citations in the corpus

• Real Exchange Rate Misalignments in the Euro Area (2020, unknown): “Corresponding estimation results are provided in column 2 of Table 2. An alternative way to explore this possibility is to split the sample of countries, and estimate eq. (4) solely for euro area countries.(30) Since 1999 and until 2009 the sensitivity of REERs to past misalignments within the euro ”