Exchange Rate And Regional Divergences : The Swiss Case
AbstractFrom 1975 to 1995, the Swiss franc appreciated in a near constant manner compared with the currencies of all of the countryâs commercial partners. This paper will seek to demonstrate that the various regions in Switzerland evolve diVerently when faced with a continuously appreciating currency. The paper is not in the nature of an econometric study and will not seek to quantify the gains and losses of each region, but it will view their structural evolution via the eVect of the exchange rates. Faced with the appreciation of the Swiss franc and based on their productive specialities, some regions suVer badly from this, whilst others cope with it and even thrive on it. It is thus possible to openly question the consequences of the Swiss National Bankâs monetary policy: has domestic industry been sacri? ced in favour of ? nancial activities? Is the continuous rise of the Swiss franc increasing regional disparities in Switzerland? The paper ? rst discusses the theories that establish a link between the exchange rate and the evolution of regional production systems. All these theories draw conclusions that can vary radically. Furthermore, they are usually based on the assumption of homogenous national territories. The second part contains a description of the methodology applied, which is based on the concept of regional production systems (RPSs). The impact of the exchange rate on RPSs is explained by means of three criteria: sectorial specialization and basic source of income within RPSs; the presence or absence of large ? rms; and the innovative capacity of the RPSs. The third part of the paper illustrates ? ve examples of RPSs, each of which has evolved in a radically diVerent way over the relevant period. Lastly, a link is established between the regional divergences and the evolution of the exchange rate in the whole of Switzerland from 1975 to 1995. The conclusion draws a parallel between the evolution in Switzerland and the tensions that could arise between th
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Bibliographic InfoPaper provided by European Regional Science Association in its series ERSA conference papers with number ersa00p340.
Date of creation: Aug 2000
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Other versions of this item:
- Jose Corpataux & Olivier Crevoisier & Alain Thierstein, 2002. "Exchange Rate and Regional Divergences: The Swiss Case," Regional Studies, Taylor & Francis Journals, vol. 36(6), pages 611-626.
- José Corpataux & Olivier Crevoisier & Alain Thierstein, 2002. "Exchange Rate and Regional Divergences: The Swiss Case," GRET Publications and Working Papers 08-02, GRET Group of Research in Territorial Economy, University of Neuchâtel.
- G3 - Financial Economics - - Corporate Finance and Governance
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- G0 - Financial Economics - - General
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- Olivier Crevoisier & Frédéric Quiquerez, 2004. "Integration of control relations in the problematic of competition between regions," ERSA conference papers ersa04p419, European Regional Science Association.
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