IDEAS home Printed from
   My bibliography  Save this article

Does the currency board regime provide an exit strategy: example of the transition economy in the process of EU/EMU accession


  • Jelena Galic

    () (Deloitte doo, Belgrade Managing Director Business Advisory Services)


The theory of international economy does not provide an unambiguous answer to the question which exchange rate regime is optimal for a certain country. Faced with macroeconomic instability, high inflation expectations and poor growth, a number of European transition economies have opted for the currency board regime. The author of the paper analyses the advantages and disadvantages of this regime. In addition, the question that arises is whether this regime provides an exit strategy, what the costs of abandoning the regime are and what could be the alternative strategy for countries which are abandoning the regime. The paper concludes that, in addition to alternative possibilities for abandoning the currency board regime, this regime is still a more superior option for countries in the EU accession process.

Suggested Citation

  • Jelena Galic, 2012. "Does the currency board regime provide an exit strategy: example of the transition economy in the process of EU/EMU accession," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 1(1), pages 59-75.
  • Handle: RePEc:cbk:journl:v:1:y:2012:i:1:p:59-75

    Download full text from publisher

    File URL:
    Download Restriction: no

    More about this item


    currency board; exit option; credibility; EU accession;

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cbk:journl:v:1:y:2012:i:1:p:59-75. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.