Classifying exchange rate regimes: Deeds vs. words
Most of the empirical literature on exchange rate regimes uses the IMF de jure classification based on the regime announced by the governments, despite the recognized inconsistencies between reported and actual policies in many cases. To address this problem, we construct a de facto classification b...
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2005
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| Acceso en línea: | https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v49_n6_p1603_LevyYeyati http://hdl.handle.net/20.500.12110/paper_00142921_v49_n6_p1603_LevyYeyati |
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paper:paper_00142921_v49_n6_p1603_LevyYeyati2023-06-08T14:36:35Z Classifying exchange rate regimes: Deeds vs. words Exchange rate regimes Fear of floating classification economic instability exchange rate IMF methodology Most of the empirical literature on exchange rate regimes uses the IMF de jure classification based on the regime announced by the governments, despite the recognized inconsistencies between reported and actual policies in many cases. To address this problem, we construct a de facto classification based on data on exchange rates and international reserves from all IMF-reporting countries over the period 1974-2000, which we believe provides a meaningful alternative for future empirical work on the topic. The classification sheds new light on several stylized facts previously reported in the literature. In particular, we find that the de facto pegs have remained stable throughout the last decade, although an increasing number of them shy away from an explicit commitment to a fixed regime ("hidden pegs"). We confirm the hollowing out hypothesis but show that it does not apply to countries with limited access to capital markets. We also find that pure floats are associated with only relatively minor nominal exchange rate volatility and that the recent increase in the number of de jure floats goes hand in hand with an increase in the number of de facto dirty floats ("fear of floating"). © 2004 Elsevier B.V. All rights reserved. 2005 https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v49_n6_p1603_LevyYeyati http://hdl.handle.net/20.500.12110/paper_00142921_v49_n6_p1603_LevyYeyati |
| institution |
Universidad de Buenos Aires |
| institution_str |
I-28 |
| repository_str |
R-134 |
| collection |
Biblioteca Digital - Facultad de Ciencias Exactas y Naturales (UBA) |
| topic |
Exchange rate regimes Fear of floating classification economic instability exchange rate IMF methodology |
| spellingShingle |
Exchange rate regimes Fear of floating classification economic instability exchange rate IMF methodology Classifying exchange rate regimes: Deeds vs. words |
| topic_facet |
Exchange rate regimes Fear of floating classification economic instability exchange rate IMF methodology |
| description |
Most of the empirical literature on exchange rate regimes uses the IMF de jure classification based on the regime announced by the governments, despite the recognized inconsistencies between reported and actual policies in many cases. To address this problem, we construct a de facto classification based on data on exchange rates and international reserves from all IMF-reporting countries over the period 1974-2000, which we believe provides a meaningful alternative for future empirical work on the topic. The classification sheds new light on several stylized facts previously reported in the literature. In particular, we find that the de facto pegs have remained stable throughout the last decade, although an increasing number of them shy away from an explicit commitment to a fixed regime ("hidden pegs"). We confirm the hollowing out hypothesis but show that it does not apply to countries with limited access to capital markets. We also find that pure floats are associated with only relatively minor nominal exchange rate volatility and that the recent increase in the number of de jure floats goes hand in hand with an increase in the number of de facto dirty floats ("fear of floating"). © 2004 Elsevier B.V. All rights reserved. |
| title |
Classifying exchange rate regimes: Deeds vs. words |
| title_short |
Classifying exchange rate regimes: Deeds vs. words |
| title_full |
Classifying exchange rate regimes: Deeds vs. words |
| title_fullStr |
Classifying exchange rate regimes: Deeds vs. words |
| title_full_unstemmed |
Classifying exchange rate regimes: Deeds vs. words |
| title_sort |
classifying exchange rate regimes: deeds vs. words |
| publishDate |
2005 |
| url |
https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v49_n6_p1603_LevyYeyati http://hdl.handle.net/20.500.12110/paper_00142921_v49_n6_p1603_LevyYeyati |
| _version_ |
1768542016563576832 |