Exchange Rate Crises In Developing Countries

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Exchange Rate Crises in Developing Countries

Michael G. Hall
Exchange Rate Crises in Developing Countries Book PDF

Author : Michael G. Hall
Publisher : Routledge
Page : 226 pages
File Size : 40,5 Mb
Release : 2018-01-18
Category : Political Science
ISBN : 9781351158435

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Exchange Rate Crises in Developing Countries by Michael G. Hall Pdf

According to many economists, the increasing mobility of capital across borders has made it more costly to peg exchange rates. This phenomenon has contributed to some of the more famous examples of exchange rate crises in recent times, such as the Mexican peso crisis in 1994 and the Asian financial crisis in 1997. Yet despite the increasing costs of pegging in today's accelerated financial markets, some developing countries try to maintain a peg for as long as they can. This work is the first to theorize the role of bankers as a domestic interest group involved in exchange rate policy. It adds to our understanding of how interest groups affect economic policy in developing countries and explains why some of the largest and fastest growing economies in the developing world were the most prone to crisis. The volume also refines our understanding of the 'hollowing-out thesis', the argument that increasing capital mobility is forcing states to abandon pegging.

Preventing Currency Crises in Emerging Markets

Sebastian Edwards,Jeffrey A. Frankel
Preventing Currency Crises in Emerging Markets Book PDF

Author : Sebastian Edwards,Jeffrey A. Frankel
Publisher : University of Chicago Press
Page : 783 pages
File Size : 43,9 Mb
Release : 2009-02-15
Category : Business & Economics
ISBN : 9780226185057

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Preventing Currency Crises in Emerging Markets by Sebastian Edwards,Jeffrey A. Frankel Pdf

Economists and policymakers are still trying to understand the lessons recent financial crises in Asia and other emerging market countries hold for the future of the global financial system. In this timely and important volume, distinguished academics, officials in multilateral organizations, and public and private sector economists explore the causes of and effective policy responses to international currency crises. Topics covered include exchange rate regimes, contagion (transmission of currency crises across countries), the current account of the balance of payments, the role of private sector investors and of speculators, the reaction of the official sector (including the multilaterals), capital controls, bank supervision and weaknesses, and the roles of cronyism, corruption, and large players (including hedge funds). Ably balancing detailed case studies, cross-country comparisons, and theoretical concerns, this book will make a major contribution to ongoing efforts to understand and prevent international currency crises.

Changes in Exchange Rates in Rapidly Developing Countries

Takatoshi Ito,Anne O. Krueger
Changes in Exchange Rates in Rapidly Developing Countries Book PDF

Author : Takatoshi Ito,Anne O. Krueger
Publisher : University of Chicago Press
Page : 466 pages
File Size : 53,9 Mb
Release : 2007-12-01
Category : Business & Economics
ISBN : 9780226386935

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Changes in Exchange Rates in Rapidly Developing Countries by Takatoshi Ito,Anne O. Krueger Pdf

The exchange rate is a crucial variable linking a nation's domestic economy to the international market. Thus choice of an exchange rate regime is a central component in the economic policy of developing countries and a key factor affecting economic growth. Historically, most developing nations have employed strict exchange rate controls and heavy protection of domestic industry-policies now thought to be at odds with sustainable and desirable rates of economic growth. By contrast, many East Asian nations maintained exchange rate regimes designed to achieve an attractive climate for exports and an "outer-oriented" development strategy. The result has been rapid and consistent economic growth over the past few decades. Changes in Exchange Rates in Rapidly Developing Countries explores the impact of such diverse exchange control regimes in both historical and regional contexts, focusing particular attention on East Asia. This comprehensive, carefully researched volume will surely become a standard reference for scholars and policymakers.

Perspectiveson the Recent Currency Crisis Literature

Mr.Robert P. Flood,Ms.Nancy P. Marion
Perspectiveson the Recent Currency Crisis Literature Book PDF

Author : Mr.Robert P. Flood,Ms.Nancy P. Marion
Publisher : International Monetary Fund
Page : 52 pages
File Size : 41,6 Mb
Release : 1998-09-01
Category : Business & Economics
ISBN : 9781451855166

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Perspectiveson the Recent Currency Crisis Literature by Mr.Robert P. Flood,Ms.Nancy P. Marion Pdf

In the 1990s, currency crises in Europe, Mexico, and Asia have drawn worldwide attention to speculative attacks on government-controlled exchange rates and have prompted researchers to undertake new theoretical and empirical analysis of these events. This paper provides some perspective on this work and relates it to earlier research. It derives the optimal commitment to a fixed exchange rate and proposes a common framework for analyzing currency crises. This framework stresses the important role of speculators and recognizes that the government’s commitment to a fixed exchange rate is constrained by other policy goals. The final section finds that some crises may be particularly difficult to predict using currently popular methods.

Exchange Rate Misalignment in Developing Countries

Sebastian Edwards,World Bank
Exchange Rate Misalignment in Developing Countries Book PDF

Author : Sebastian Edwards,World Bank
Publisher : Johns Hopkins University Press
Page : 110 pages
File Size : 53,9 Mb
Release : 1988
Category : Business & Economics
ISBN : STANFORD:36105040907409

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Exchange Rate Misalignment in Developing Countries by Sebastian Edwards,World Bank Pdf

This article analyzes the theory of equilibrium real exchange rates and defines misalignment as a deviation of the real exchange rate (RER) from its equilibrium level. The role of macroeconomic policies is then analyzed under three alternative nominal exchange rate regimes: predetermined nominal exchange rates; floating nominal rates; and dual or black market nominal exchange rates. This discussion points out how inconsistent macroeconomic policies often lead to real exchange rate misalignment. Corrective measures, including nominal devaluation and several alternative approaches, are then evaluated.

Exchange Rate Misalignment

Lawrence E. Hinkle,Peter J. Montiel,Peter Montiel
Exchange Rate Misalignment Book PDF

Author : Lawrence E. Hinkle,Peter J. Montiel,Peter Montiel
Publisher : World Bank Publications
Page : 638 pages
File Size : 41,8 Mb
Release : 1999
Category : Business & Economics
ISBN : 9780195211269

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Exchange Rate Misalignment by Lawrence E. Hinkle,Peter J. Montiel,Peter Montiel Pdf

The study cautiously identifies exchange rate misalignment as an important element in most of the exchange rate crises that plagued the developing world during the last decade. Given that the increasing integration of world capital markets, has escalated the costs of such crises, a broad consensus emerged in recent years, that the overriding objective of exchange rate policy in developing countries, should be to avoid episodes of prolonged, and substantial misalignment, i.e., situations in which the actual real exchange rate differs significantly from its long-run equilibrium value. It was the Bank's involvement in one such misalignment episode, that eventually led to this book. Following an overview on the concepts and measurement of exchange rate misalignment, its impact on the purchasing power parity, and the relationship between the external real exchange rate (RER), and the two-good internal RER for tradables non-tradables, the study presents methodologies - empirical applications - for estimating the RER equilibrium. The study reaches an optimistic conclusion - that enough is known to identify cases of misalignment, and be able to sound clear warning signals. The implication for exchange rate policy is that ignorance about the empirical value of the equilibrium exchange rate, cannot be used to clinch arguments for extreme exchange arrangements, such as clean floats, currency boards, and "dollarization."

Exchange Rate Overvaluation and Trade Protection

Howard J. Shatz,David G. Tarr
Exchange Rate Overvaluation and Trade Protection Book PDF

Author : Howard J. Shatz,David G. Tarr
Publisher : World Bank Publications
Page : 36 pages
File Size : 42,6 Mb
Release : 2000
Category : Black market in foreign exchange
ISBN : 8210379456XXX

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Exchange Rate Overvaluation and Trade Protection by Howard J. Shatz,David G. Tarr Pdf

"Lessons from world experience about the consequences of exchange rate overvaluation (the frequent cause of trade crises), the consequences of trying to defend an overvalued exchange rate, and the most appropriate policies for resolving an overvaluation"--Cover.

Current Account Reversals and Currency Crises

Mr.Gian Milesi-Ferretti,Assaf Razin
Current Account Reversals and Currency Crises Book PDF

Author : Mr.Gian Milesi-Ferretti,Assaf Razin
Publisher : International Monetary Fund
Page : 45 pages
File Size : 44,6 Mb
Release : 1998-06-01
Category : Business & Economics
ISBN : 9781451952421

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Current Account Reversals and Currency Crises by Mr.Gian Milesi-Ferretti,Assaf Razin Pdf

This paper studies large reductions in current account deficits and exchange rate depreciations in low- and middle-income countries. It examines which factors help predict the occurrence of a reversal or a currency crisis, and how these events affect macroeconomic performance. Both domestic factors, such as the low reserves, and external factors, such as unfavorable terms of trade, are found to trigger reversals and currency crises. The two types of events are, however, distinct; an exchange rate crash is associated with a fall in output growth and a recovery thereafter, while for reversals there is no systematic evidence of a growth slowdown.

Evolution and Performance of Exchange Rate Regimes

Mr.Kenneth Rogoff,Mr.Ashoka Mody,Nienke Oomes,Mr.Robin Brooks,Mr.Aasim M. Husain
Evolution and Performance of Exchange Rate Regimes Book PDF

Author : Mr.Kenneth Rogoff,Mr.Ashoka Mody,Nienke Oomes,Mr.Robin Brooks,Mr.Aasim M. Husain
Publisher : International Monetary Fund
Page : 85 pages
File Size : 53,8 Mb
Release : 2003-12-01
Category : Business & Economics
ISBN : 9781451875843

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Evolution and Performance of Exchange Rate Regimes by Mr.Kenneth Rogoff,Mr.Ashoka Mody,Nienke Oomes,Mr.Robin Brooks,Mr.Aasim M. Husain Pdf

Using recent advances in the classification of exchange rate regimes, this paper finds no support for the popular bipolar view that countries will tend over time to move to the polar extremes of free float or rigid peg. Rather, intermediate regimes have shown remarkable durability. The analysis suggests that as economies mature, the value of exchange rate flexibility rises. For countries at a relatively early stage of financial development and integration, fixed or relatively rigid regimes appear to offer some anti-inflation credibility gain without compromising growth objectives. As countries develop economically and institutionally, there appear to be considerable benefits to more flexible regimes. For developed countries that are not in a currency union, relatively flexible exchange rate regimes appear to offer higher growth without any cost in credibility.

Demanding Devaluation

David A. Steinberg
Demanding Devaluation Book PDF

Author : David A. Steinberg
Publisher : Cornell University Press
Page : 320 pages
File Size : 50,5 Mb
Release : 2015-11-16
Category : Political Science
ISBN : 9780801456497

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Demanding Devaluation by David A. Steinberg Pdf

Exchange rate policy has profound consequences for economic development, financial crises, and international political conflict. Some governments in the developing world maintain excessively weak and "undervalued" exchange rates, a policy that promotes export-led development but often heightens tensions with foreign governments. Many other developing countries "overvalue" their exchange rates, which increases consumers' purchasing power but often reduces economic growth. In Demanding Devaluation, David Steinberg argues that the demands of powerful interest groups often dictate government decisions about the level of the exchange rate.Combining rich qualitative case studies of China, Argentina, South Korea, Mexico, and Iran with cross-national statistical analyses, Steinberg reveals that exchange rate policy is heavily influenced by a country's domestic political arrangements. Interest group demands influence exchange rate policy, and national institutional structures shape whether interest groups lobby for an undervalued or an overvalued rate. A country's domestic political system helps determine whether it undervalues its exchange rate and experiences explosive economic growth or if it overvalues its exchange rate and sees its economy stagnate as a result.

Banking Crises and Exchange Rate Regimes

Ilker Domaç,Maria Soledad Martinez Peria
Banking Crises and Exchange Rate Regimes Book PDF

Author : Ilker Domaç,Maria Soledad Martinez Peria
Publisher : World Bank Publications
Page : 48 pages
File Size : 50,6 Mb
Release : 2000
Category : Bank failures
ISBN : 8210379456XXX

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Banking Crises and Exchange Rate Regimes by Ilker Domaç,Maria Soledad Martinez Peria Pdf

Pursuing a policy of exchange rate stability reduces the probability of banking crises, particularly in developing countries.

Devaluation Crises and the Macroeconomic Consequences of Postponed Adjustment in Developing Countries

International Monetary Fund
Devaluation Crises and the Macroeconomic Consequences of Postponed Adjustment in Developing Countries Book PDF

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 38 pages
File Size : 46,7 Mb
Release : 1989-01-01
Category : Business & Economics
ISBN : 9781451925845

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Devaluation Crises and the Macroeconomic Consequences of Postponed Adjustment in Developing Countries by International Monetary Fund Pdf

This paper develops a small analytical model to explore the relationship between the dynamics of macroeconomic adjustment and the timing of the implementation of an adjustment program featuring a nominal devaluation. The effects of postponing adjustment depend on the source of the original shock. In the case of a fiscal expansion, postponement implies a larger eventual devaluation and greater deviations of macroeconomic variables from their steady-state values. For adverse terms of trade shocks, postponement does not affect the size of the eventual devaluation, but does magnify the degree of post-devaluation overshooting by key macroeconomic variables.

Quantitative Exchange Rate Economics in Developing Countries

M. Rusydi,S. Islam
Quantitative Exchange Rate Economics in Developing Countries Book PDF

Author : M. Rusydi,S. Islam
Publisher : Springer
Page : 152 pages
File Size : 51,6 Mb
Release : 2007-07-12
Category : Business & Economics
ISBN : 9780230592483

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Quantitative Exchange Rate Economics in Developing Countries by M. Rusydi,S. Islam Pdf

This book examines the options for adopting an appropriate model of the exchange rate determination and its associated regime suitable for developing countries. It shows that a credible exchange rate regime and policy may mitigate the flight to currency from broad money, and ensure stability and certainty for private sectors.

The Politics of Exchange Rates in Developing Countries

Ralph Setzer
The Politics of Exchange Rates in Developing Countries Book PDF

Author : Ralph Setzer
Publisher : Springer Science & Business Media
Page : 265 pages
File Size : 51,7 Mb
Release : 2006-09-21
Category : Business & Economics
ISBN : 9783790817164

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The Politics of Exchange Rates in Developing Countries by Ralph Setzer Pdf

This book considers the issue of exchange rate policymaking from a political economy perspective. It illustrates both theoretically and empirically how domestic political and institutional incentives shape exchange rate policies in developing countries. Empirical analysis is based on a panel survey of 47 countries and thereby provides insights on how political and institutional conditions typically affect exchange rate policy.

Adjustment, Investment, and the Real Exchange Rate in Developing Countries

Anonim
Adjustment Investment and the Real Exchange Rate in Developing Countries Book PDF

Author : Anonim
Publisher : World Bank Publications
Page : 49 pages
File Size : 53,9 Mb
Release : 2024-05-21
Category : Electronic
ISBN : 8210379456XXX

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Adjustment, Investment, and the Real Exchange Rate in Developing Countries by Anonim Pdf

LDC adjustment packages Riccardo Faini and Jaime de Melo Developing countries have been hit by a fall in their terms of trade, high real interest rates on their external debt, and a drought in commercial lending from abroad. Their subsequent adjustment packages, often supported by loans from the IMF and World Bank, focused on a sharp real exchange rate depreciation to restore external balance and a host of microeconomic reforms to secure a simultaneous supply-side improvement. This paper examines the success of these ‘adjustment with growth' packages in a large sample of developing countries. We find these packages have been much more successful in LDCs which export manufactures than they have in those concentrating on primary exports (primarily low-income African countries); the latter have not resumed sustainable growth, and most of their external adjustment has arisen from expenditure reduction, not an increase in supply. The longer-term prospects for manufacturing exporters are also brighter: there we detect signs of increased efficiency and a smaller decline in investment than in primary exporters. But we also find that a high external debt burden and an unstable macroeconomic environment impede investment in all LDCs. In the longer term, adjustment with growth packages will succeed only if they are accompanied by a more stable macroeconomic environment and appropriate debt relief