Fixed exchange rates and sticky Prices in emerging markets
Miles, William
Miles, William
Citations
Altmetric:
Authors
Other Names
Location
Time Period
Advisors
Original Date
Digitization Date
Issue Date
2003-06-23
Type
Article
Genre
Keywords
Subjects (LCSH)
Citation
Miles, W. (2003), Fixed exchange rates and sticky prices in emerging markets. J. Int. Dev., 15: 575-586
Abstract
In the wake of financial crises in emerging markets, firmly fixed exchange rates and even dollarization have been advocated as a means to decrease vulnerability. There are many important new issues related to fixing the exchange rate and financial vulnerability, but one long-time vital concern for a fixed currency regime persists: the flexibility of domestic prices and wages. In the presence of high nominal rigidities, fixed rates can lead to large output costs in the aftermath of negative macroeconomic shocks. Employing a method previously applied to the gold standard fixed rate regime, we find generally flat aggregate supply curves in a sample of five emerging markets. This indicates substantial inflexibility of prices, and large losses in terms of income and employment in a fixed exchange rate regime subsequent to negative shocks.
Table of Contents
Description
Click on the DOI link to access the article (may not be free).
Publisher
John Wiley & Sons, Ltd.
Journal
Book Title
Series
Journal of International Development;v.15:no.5
Digital Collection
Finding Aid URL
Use and Reproduction
Archival Collection
PubMed ID
DOI
ISSN
1099-1328