Fixing Exchange Rates: A Virtual Quest for Fundamentals

Robert Flood () and Andrew Rose

No 838, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Fixed exchange rates are less volatile than floating rates. The volatility of macroeconomic variables, such as money and output, does not change very much across exchange rate regimes, however. This suggests that exchange rate models based only on macroeconomic fundamentals are unlikely to be very successful. It also suggests that there is no clear trade-off between reduced exchange rate volatility and macroeconomic stability.

Keywords: Exchange Rates; Fixed; Floating; Monetary; Regime; Structural; Traditional; Volatility (search for similar items in EconPapers)
JEL-codes: F31 F33 (search for similar items in EconPapers)
Date: 1993-09
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Citations: View citations in EconPapers (14)

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Related works:
Journal Article: Fixing exchange rates A virtual quest for fundamentals (1995)
Working Paper: Fixing Exchange Rates: A Virtual Quest for Fundamentals (1993)
Working Paper: Fixing Exchange Rates: A Virtual Quest for Fundamentals (1992)
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