CHOOSING AN OPTIMAL EXCHANGE RATE REGIME: A CRITICAL LITERATURE REVIEW

Abstract

This paper critically reviews the theoretical and empirical literature on the choice of exchange rate regime.Although much has been learned in each approach, this paper highlights the areas of research in which our understanding of exchange rate regime is still incomplete. Prominent issues include: (i) the discrepancy between declared and actual regime, and the different approaches of the exchange regime choice (ii) the critical review of the theoretical and empirical literature, (iii) the conclusion.

Keywords: Credibility, Exchange rate regime, Flexibility, The bipolar view., The structural approach

Article Review Status: Published

Pages: 11-35 (Download PDF)

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