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De Facto exchange rate arrangement tightness and bilateral trade flows

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  • Egger, Peter

Abstract

This paper estimates the effect of switching into and out of 14 different modes of exchange rate arrangements on bilateral exports between 1948 and 2001 in the world economy. Increasing the exchange rate arrangement tightness by one degree in the classification of Reinhart and Rogoff [Reinhart, Carmen M. and Kenneth S. Rogoff (2004), The Modern History of Exchange Rate Arrangements: A Reinterpretation, Quarterly Journal of Economics 119, 1-48.] increases bilateral trade flows by about 2-4% as compared to their initial level.

Suggested Citation

  • Egger, Peter, 2008. "De Facto exchange rate arrangement tightness and bilateral trade flows," Economics Letters, Elsevier, vol. 99(2), pages 228-232, May.
    • Handle: RePEc:eee:ecolet:v:99:y:2008:i:2:p:228-232
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    References listed on IDEAS

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    1. Glick, Reuven & Rose, Andrew K., 2002. "Does a currency union affect trade? The time-series evidence," European Economic Review, Elsevier, vol. 46(6), pages 1125-1151, June.
    2. Reinhart, Carmen, 2002. "A Modern History of Exchange Rate Arrangements: The Country Histories, 1946-2001," MPRA Paper 13191, University Library of Munich, Germany.
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    Cited by:

    1. Dorn, Sabrina & Egger, Peter, 2015. "On the distribution of exchange rate regime treatment effects on international trade," Journal of International Money and Finance, Elsevier, vol. 53(C), pages 75-94.
    2. Hogrefe, Jan & Jung, Benjamin & Kohler, Wilhelm K., 2010. "Readdressing the trade effect of the Euro: Allowing for currency misalignment," ZEW Discussion Papers 10-023, ZEW - Leibniz Centre for European Economic Research.
    3. Thangavelu, Shandre M. & Narjoko, Dionisius, 2014. "Human capital, FTAs and foreign direct investment flows into ASEAN," Journal of Asian Economics, Elsevier, vol. 35(C), pages 65-76.
    4. Mahvash S Qureshi & Mr. Charalambos G Tsangarides, 2010. "The Empirics of Exchange Rate Regimes and Trade: Words vs. Deeds," IMF Working Papers 2010/048, International Monetary Fund.
    5. Peter Egger & Yvonne Wolfmayr, 2014. "What Economists Should Know About International Goods Trade Data," WIFO Working Papers 475, WIFO.

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