To Peg or Not to Peg A Template for Assessing the Nobler

This paper proposes a template for assessing whether or not a country's economic and financial characteristics make it an appropriate candidate for a pegged exchange rate regime. The template employs quantifiable measures of attributes-trade orientation, financial integration, economic diversif...

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Bibliographic Details
Main Author: Husain, Aasim
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2006
Series:IMF Working Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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245 0 0 |a To Peg or Not to Peg  |b A Template for Assessing the Nobler  |c Aasim Husain 
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300 |a 29 pages 
651 4 |a Pakistan 
653 |a Government and the Monetary System 
653 |a Inflation 
653 |a Payment Systems 
653 |a Monetary economics 
653 |a Currency; Foreign exchange 
653 |a Regimes 
653 |a Deflation 
653 |a Exchange rate adjustments 
653 |a Money 
653 |a Price Level 
653 |a Foreign Exchange 
653 |a Standards 
653 |a Exchange rate flexibility 
653 |a Currencies 
653 |a Monetary Systems 
653 |a Prices 
653 |a Macroeconomics 
653 |a Exchange rates 
653 |a Money and Monetary Policy 
653 |a Foreign exchange 
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520 |a This paper proposes a template for assessing whether or not a country's economic and financial characteristics make it an appropriate candidate for a pegged exchange rate regime. The template employs quantifiable measures of attributes-trade orientation, financial integration, economic diversification, macroeconomic stabilization, credibility, and "fear-offloating" type effects-that have been identified in the literature as key potential determinants of regime choice. To illustrate, the template is applied to Kazakhstan and Pakistan. The results indicate a fairly strong case against a pegged regime in Pakistan. The implications for Kazakhstan are mixed, although changes in that economy in recent years strengthen the case against a peg