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A survey of the institutional and operational aspects of modern-day currency boards

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  • Corrinne Ho

Abstract

This paper surveys the institutional and operational features of the six modern currency boards. The survey is developed around three key aspects: organisation, operations and legal foundation. By laying out the facts, this survey seeks to shed light on how and why modern currency boards in practice are different from the classic definition, and to distil from their features an updated definition and the revised "rules of the game".

Suggested Citation

  • Corrinne Ho, 2002. "A survey of the institutional and operational aspects of modern-day currency boards," BIS Working Papers 110, Bank for International Settlements.
    • Handle: RePEc:bis:biswps:110
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    References listed on IDEAS

    as
    1. Mr. Charles Enoch & Mr. Tomás J. T. Baliño, 1997. "Currency Board Arrangements: Issues and Experiences," IMF Occasional Papers 1997/005, International Monetary Fund.
    2. Steve H. Hanke, 1999. "Dollarization For Argentina," Journal of Applied Corporate Finance, Morgan Stanley, vol. 12(1), pages 121-126, March.
    3. Barro, Robert J & Gordon, David B, 1983. "A Positive Theory of Monetary Policy in a Natural Rate Model," Journal of Political Economy, University of Chicago Press, vol. 91(4), pages 589-610, August.
    4. Gerald Caprio & Michael Dooley & Danny Leipziger & Carl Walsh, 1996. "The lender of last resort function under a currency board: The case of Argentina," Open Economies Review, Springer, vol. 7(1), pages 625-650, March.
    5. Schwartz, Anna J., 1993. "Currency boards: their past, present, and possible future role," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 147-187, December.
    6. Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 473-491, June.
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    Citations

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    Cited by:

    1. Gert Schnabel, 2002. "Output trends and Okun's law," BIS Working Papers 111, Bank for International Settlements.
    2. M. Berlemann & Nikolay Nenovsky, 2003. "Lending of First Versus Lending of Last Resort: The Bulgarian Financial Crisis of 1996/1997," Post-Print halshs-00260241, HAL.
    3. repec:got:cegedp:36 is not listed on IDEAS
    4. Frederik Kunze, 2020. "Predicting exchange rates in Asia: New insights on the accuracy of survey forecasts," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 39(2), pages 313-333, March.
    5. Steve Hanke, 2002. "On dollarization and currency boards: Error and deception," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 5(4), pages 203-222.
    6. Mr. Pablo F Druck & Mr. Mario Dehesa, 2008. "The Eastern Caribbean Central Bank: Challenges to an Effective Lender of Last Resort," IMF Working Papers 2008/214, International Monetary Fund.
    7. Neven Valev & John Carlson, 2007. "Beliefs about Exchange‐Rate Stability: Survey Evidence from the Currency Board in Bulgaria," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 10(2), pages 111-121.
    8. Dobieslaw Tymoczko, 2005. "The Future of Central Banking in the Changing Financial Environment," NBP Working Papers 33, Narodowy Bank Polski.
    9. Cappiello, Antonio, 2006. "I currency board come strumento di stabilizzazione economica: come funzionano e dove sono adottati [Currency boards as instrument for economic stabilisation: how they work and where they are adopte," MPRA Paper 4966, University Library of Munich, Germany.
    10. International Monetary Fund, 2006. "Panama: Selected Issues and Statistical Appendix," IMF Staff Country Reports 2006/026, International Monetary Fund.
    11. Neven T Valev, 2006. "From a Currency Board to the Euro: Public Attitudes Toward Unilateral Euroisation in Bulgaria1," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 48(3), pages 480-496, September.
    12. Heiner Brockmann & Horst Keppler, 2003. "Do currency boards increase the credibility of exchange-rate pegs?," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 38(6), pages 328-333, November.
    13. Oliver Grimm, 2007. "Fiscal Discipline and Stability under Currency Board Systems," CER-ETH Economics working paper series 07/66, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    14. Switgard Feuerstein & Oliver Grimm, 2006. "On the Credibility of Currency Boards," Review of International Economics, Wiley Blackwell, vol. 14(5), pages 818-835, November.
    15. Buks Wessels, 2007. "Currency Board Arrangements As A Super‐Fixed Alternative In The Choice Of Exchange Rate Regime1," South African Journal of Economics, Economic Society of South Africa, vol. 75(4), pages 708-718, December.
    16. Serge Jeanneau & Marian Micu, 2002. "Determinants of international bank lending to emerging market countries," BIS Working Papers 112, Bank for International Settlements.
    17. John Hawkins & Paul Masson, 2003. "Economic aspects of regional currency areas and the use of foreign currencies," BIS Papers chapters, in: Bank for International Settlements (ed.), Regional currency areas and the use of foreign currencies, volume 17, pages 4-42, Bank for International Settlements.
    18. Kunze, Frederik, 2017. "Predicting exchange rates in Asia: New insights on the accuracy of survey forecasts," University of Göttingen Working Papers in Economics 326, University of Goettingen, Department of Economics.
    19. Neven T. Valev & John A. Carlson, 2007. "Beliefs about Exchange-Rate Stability: Survey Evidence from the Currency Board in Bulgaria," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 10(2), pages 111-121.

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    More about this item

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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