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220928 ||| eng |
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|a 9798400207600
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| 100 |
1 |
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|a Elekdag, Selim
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| 245 |
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|a Weather Shocks and Exchange Rate Flexibility
|c Selim Elekdag, Maxwell Tuuli
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| 260 |
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|a Washington, D.C.
|b International Monetary Fund
|c 2022
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| 300 |
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|a 38 pages
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| 651 |
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4 |
|a Colombia
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| 653 |
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|a Economic & financial crises & disasters
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| 653 |
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|a Economics
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| 653 |
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|a Exchange rate arrangements
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| 653 |
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|a Finance
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| 653 |
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|a Population Growth
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| 653 |
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|a Natural Disasters and Their Management
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| 653 |
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|a Environmental Accounts and Accounting
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| 653 |
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|a Economics: General
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| 653 |
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|a Climate
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| 653 |
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|a Exchange rate adjustments
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| 653 |
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|a Informal sector
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| 653 |
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|a Currency
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| 653 |
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|a General Financial Markets: General (includes Measurement and Data)
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| 653 |
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|a Economics of specific sectors
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| 653 |
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|a Environment and Development
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| 653 |
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|a Foreign Exchange
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| 653 |
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|a Currency crises
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| 653 |
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|a Financial markets
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| 653 |
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|a Emerging and frontier financial markets
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| 653 |
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|a Conventional peg
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| 653 |
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|a Global Warming
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| 653 |
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|a Environmental Equity
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| 653 |
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|a Exchange rate flexibility
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| 653 |
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|a Sustainability
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| 653 |
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|a Environment and Growth
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| 653 |
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|a Macroeconomics
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| 653 |
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|a Financial services industry
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| 653 |
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|a Economic Growth and Aggregate Productivity: General
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| 653 |
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|a Environment and Trade
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| 653 |
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|a Macroeconomic Aspects of International Trade and Finance: General
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| 653 |
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|a Finance: General
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| 653 |
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|a Foreign exchange
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| 700 |
1 |
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|a Tuuli, Maxwell
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| 041 |
0 |
7 |
|a eng
|2 ISO 639-2
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| 989 |
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|b IMF
|a International Monetary Fund
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| 490 |
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|a IMF Working Papers
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| 028 |
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|a 10.5089/9798400207600.001
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| 856 |
4 |
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|u https://elibrary.imf.org/view/journals/001/2022/093/001.2022.issue-093-en.xml?cid=517525-com-dsp-marc
|x Verlag
|3 Volltext
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| 082 |
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|a 330
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| 520 |
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|a This paper assesses the stabilization properties of fixed versus flexible exchange rate regimes and aims to answer this research question: Does greater exchange rate flexibility help an economy’s adjustment to weather shocks? To address this question, the impact of weather shocks on real per capita GDP growth is quantified under the two alternative exchange rate regimes. We find that although weather shocks are generally detrimental to per capita income growth, the impact is less severe under flexible exchange rate regimes. Moreover, the medium-term adverse growth impact of a 1 degree Celsius increase in temperature under a pegged regime is about –1.4 percentage points on average, while under a flexible regime, the impact is less than one half that amount (–0.6 percentage point). This finding bolsters the idea that exchange rate flexibility not only helps mitigate the initial impact of the shock but also promotes a faster recovery. In terms of mechanisms, our findings suggest that the depreciation of the nominal exchange rate under a flexible regime supports real export growth. In contrast to standard theoretical predictions, we find that countercyclical fiscal policy may not be effective under pegged regimes amid high debt, highlighting the importance of the policy mix and precautionary (fiscal) buffers
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