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Target zones in History and Theory : efficiency, credibility and policy autonomy

Author

Listed:
  • Marc Flandreau

    (Centre for Finance and Development - GRADUATE INSTITUTE OF INTERNATIONAL AND DEVELOPMENT STUDIES)

  • John Komlos

    (Department of Economics - Tilburg University [Netherlands])

Abstract

A natural experiment with an exchange-rate band in Austria-Hungary in the early 20th century provides a rare opportunity to discuss critical aspects of the theory of target zones. Providing a new derivation of the target zone model as a set of nested hypotheses, the inference is drawn that policy credibility and market efficiency were paramount in the success of the Austro-Hungarian experience.

Suggested Citation

  • Marc Flandreau & John Komlos, 2005. "Target zones in History and Theory : efficiency, credibility and policy autonomy," Working Papers hal-01065605, HAL.
    • Handle: RePEc:hal:wpaper:hal-01065605
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-01065605
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    References listed on IDEAS

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    6. John Komlos & Marc Flandreau, "undated". "Core or Periphery? The Credibility of the Austro-Hungarian Currency, 1867-1913," Articles by John Komlos 4, Department of Economics, University of Munich.
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    Cited by:

    1. Flandreau, Marc, 2006. "The logic of compromise: Monetary bargaining in Austria-Hungary, 1867–1913," European Review of Economic History, Cambridge University Press, vol. 10(1), pages 3-33, April.
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