The Impact of Fixed Exchange Rates on Fiscal Discipline
AbstractIn this paper, it is shown that, contrary to standard arguments, fiscal discipline is not substantially enhanced by a fixed exchange rate regime. This study is based on data from 116 countries collected from 1975 to 2004 and uses various estimation techniques for dynamic panel data, in particular a GMM estimation in the tradition of Arellano and Bover (1995), and Blundell and Bond (1998). Contrary to previous papers on this topic, the present paper takes into account that the consequences of a new exchange rate regime do not necessarily fully manifest immediately. --
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Scottish Economic Society in its journal Scottish Journal of Political Economy.
Volume (Year): 58 (2011)
Issue (Month): 5 (November)
Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0036-9292
More information through EDIRC
Other versions of this item:
- El-Shagi, Makram, 2009. "The impact of fixed exchange rates on fiscal discipline," Center for European, Governance and Economic Development Research Discussion Papers 84, University of Goettingen, Department of Economics.
- F31 - International Economics - - International Finance - - - Foreign Exchange
- E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
- O23 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Enrique Alberola & Luis Molina & Daniel Navia, 2005.
"Say you fix, enjoy and relax: the deleterious effect of peg announcements on fiscal discipline,"
Banco de Espaï¿½a Working Papers
0523, Banco de Espa�a.
- Enrique Alberola & Luis Molina & Daniel Navia, 2005. "Say You Fix, Enjoy And Relax The Deleterious Effect Of Peg Announcements On Fiscal Discipline," International Finance 0509001, EconWPA.
- Carmen M. Reinhart & Kenneth S. Rogoff, 2004.
"The Modern History of Exchange Rate Arrangements: A Reinterpretation,"
The Quarterly Journal of Economics,
MIT Press, vol. 119(1), pages 1-48, February.
- Carmen M. Reinhart & Kenneth S. Rogoff, 2002. "The Modern History of Exchange Rate Arrangements: A Reinterpretation," NBER Working Papers 8963, National Bureau of Economic Research, Inc.
- Reinhart, Carmen & Rogoff, Kenneth, 2004. "The modern history of exchange rate arrangements: A reinterpretation," MPRA Paper 14070, University Library of Munich, Germany.
- Paul De Grauwe & Gunther Schnabl, 2004.
"Exchange Rate Regimes and Macroeconomic Stability in Central and Eastern Europe,"
- Paul De Grauwe & Gunther Schnabl, 2004. "Exchange Rate Regimes and Macroeconomic Stability in Central and Eastern Europe," CESifo Working Paper Series 1182, CESifo Group Munich.
- Barbara Annicchiarico, 2003.
"Fiscal Policy and Exchange Rates,"
CEIS Research Paper
7, Tor Vergata University, CEIS.
- Enrique Alberola & Luis Molina, 2003. "What Does Really Discipline Fiscal Policy in Emerging Markets?: the Role and Dynamics of Exchange Rate Regimes," Money Affairs, Centro de Estudios Monetarios Latinoamericanos, vol. 0(2), pages 165-192, July-Dece.
- Daniel, Betty C., 2000. "The timing of exchange rate collapse," Journal of International Money and Finance, Elsevier, vol. 19(6), pages 765-784, December.
- Enrique Alberola & Luis Molina, 2005.
"What Does Really Discipline Fiscal Policy In Emerging Markets? The Role And Dynamics Of Exchange Rate Regimes,"
- Enrique Alberola & Luis Molina, 2004. "What does really discipline fiscal policy in emerging markets? The role and dynamics of exchange rate regimes," Banco de Espaï¿½a Working Papers 0402, Banco de Espa�a.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.