Exchange Rate Volatility and Growth in Small Open Economies at the EMU Periphery

By G. Schnabl. Social Science Research Network, 2008

217 citations recorded by the source corpus.

Since the introduction of the euro in January 1999, exchange rate stability in the periphery of the euro area is growing. The paper investigates the impact of exchange rate stability on growth for a sample of 41 mostly small open economies at the EMU periphery. It identifies international trade, international capital flows and macroeconomic stability as important transmission channels from exchange rate stability to more growth. Panel estimations reveal a robust negative relationship between exchange rate volatility and growth for countries in the economic catch-up process with open capital accounts.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/d156ceeec632572fdb6778744db03026d6612e59

Citations in the corpus

• Volatility of Exchange Rates in Selected New EU Members: Evidence from Daily Data (2008, unknown): “Exchange rate volatility in selected NMS is also analyzed by Kočenda and Valachy (2006) and Schnabl (2008).”