 Currency Boards: The Ultimate Fix?Atish Ghosh () No 1998/008, IMF Working Papers from International Monetary Fund Abstract: The growing integration of world capital markets has made it fashionable to argue that only extreme exchange rate regimes are sustainable. Short of adopting a common currency, currency board arrangements represent the most extreme form of exchange rate peg. This paper compares the macroeconomic performance of countries with currency boards to those with other forms of pegged exchange rate regime. Currency boards are indeed associated with better inflation performance, even allowing for potential endogeneity of the choice of regime. Perhaps more surprisingly, this better inflation performance is accompanied by higher output growth. Keywords: WP; currency; Board country; Currency Boards; Fixed Exchange Rates; Inflation; Growth; inflation differential; structural equation; inflation performance; peg currency; currency board country; currency board members; currency board regime; money growth rate; adoption of a currency board; performance of currency board regime; inflation rate; exchange rate observation; Exchange rate arrangements; Exchange rates; Foreign assets; Caribbean; Global (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1998/008 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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