Foreign exchange pressures in Latin America: does debt matter?
AbstractLatin American countries have been in the eye of economic and financial storms several times in recent years. Advice from the International Monetary Fund has consistently highlighted the need for sound fiscal policies and lower debt levels. But is public debt relevant? Following a brief discussion of the theoretical issues involved, this paper examines empirically the relationship between public indebtedness and pressures in the foreign exchange market. Alternative measures are used to capture the latter and the analysis controls for a de facto classification of exchange rate regimes. Estimations of static and dynamic panels for 28 Latin American and Caribbean (LAC) countries report substantial fiscal effects. Copyright © 2008 John Wiley & Sons, Ltd.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Journal of International Development.
Volume (Year): 20 (2008)
Issue (Month): 5 ()
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Other versions of this item:
- Graham Bird & Alex Mandilaras, 2007. "Foreign Exchange Pressures in Latin America: Does Debt Matter?," School of Economics Discussion Papers 1307, School of Economics, University of Surrey.
- F30 - International Economics - - International Finance - - - General
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