Exchange-Rate Regimes and International Trade: Evidence from the=20 Classical Gold Standard Era
AbstractIn this paper we show that the spread of the classical gold=20 standard in the late nineteenth century increased international trade=20 flows. This positive effect was compounded whenever a group of countries=20 formed a monetary union. Applying the gravity model of trade to more than=20 1,100 country pairs during the 1870-1910 period, we find that two countries= =20 on gold would trade 60 percent more with each other than with countries on= =20 a different monetary standard. Moreover, a monetary union would more than=20 double bilateral trade flows. Our findings are relevant for current=20 discussions on alternative monetary arrangements for the twenty-first= century.
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Bibliographic InfoPaper provided by EconWPA in its series Labor and Demography with number 0012003.
Length: 52 pages
Date of creation: 09 Feb 2001
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Find related papers by JEL classification:
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- N21 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: Pre-1913
- N23 - Economic History - - Financial Markets and Institutions - - - Europe: Pre-1913
- N26 - Economic History - - Financial Markets and Institutions - - - Latin America; Caribbean
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