Does the Nominal Exchange Rate Regime Matter? /
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Author / Creator: | Ghosh, Atish R. |
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Imprint: | Cambridge, Mass. National Bureau of Economic Research 1997. |
Description: | 1 online resource. |
Language: | English |
Series: | NBER working paper series no. w5874 Working paper series (National Bureau of Economic Research) ; no. w5874. |
Subject: | |
Format: | E-Resource Book |
URL for this record: | http://pi.lib.uchicago.edu/1001/cat/bib/13512332 |
Other authors / contributors: | Gulde, Anne-Marie. Ostry, Jonathan D. Wolf, Holger C. |
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Notes: | January 1997. ]note: King's username and password for off campus access.]. Mode of access: World Wide Web. |
Summary: | The relevance of the exchange rate regime for macroeconomic performance remains a key issue in international macroeconomics. We use a comprehensive dataset covering nine regime-types for one hundred forty countries over thirty years to examine the link between the regime, inflation, and growth. Two sturdy stylized facts emerge. First, inflation is both lower and more stable under pegged regimes, reflecting both slower money supply and faster money demand growth. Second, real volatility is higher under pegged regimes. In contrast, growth varies only slightly across regimes, though investment is somewhat higher and trade growth somewhat lower under pegged regimes. Pegged regimes are thus characterized by lower inflation but more pronounced output volatility. |
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