Experience with the Crawling Peg in Colombia

Miguel Urrutia

A chapter in Exchange Rate Rules, 1981, pp 207-229 from Palgrave Macmillan

Abstract: Abstract The fixed exchange rate regime was very costly for Colombia in the post-war period. Although inflation rates were modest by Latinamerican standards, they tended to be higher than those of the developed countries. The result was a permanent tendency for the exchange rate to become overvalued. Due to the apparent political cost of large devaluations, the decision to adjust exchange rates tended to be postponed, and this produced a stop-go cycle in the economy and created conditions of uncertainty that hindered the development of non-traditional exports.

Keywords: Exchange Rate; Foreign Exchange; Real Exchange Rate; Real Wage; Money Supply (search for similar items in EconPapers)
Date: 1981
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-05166-3_10

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DOI: 10.1007/978-1-349-05166-3_10

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