Exchange-Rate Policies For Emerging Market Economies

With the loss of Soviet control in Central and Eastern Europe, as well as the move toward economic liberalization in many developing countries, a huge increase in the number of convertible currencies in the world has occurred. A key aspect of the management of these currencies involves their relationships with the world economy, which is determined partly by type of exchange rate. Contributors to this volume argue that the costs and benefits of fixed versus flexible rates vary systematically across different types of economies }With the collapse of the former Soviet Union, many countries were faced with the need to establish national currencies. A number of additional formerly communist countries were forced to fundamentally adjust their monetray policies to deal with the transition to market-oriented economies. The process of liberalization in dozens of developing countrys left their governments faced with similar, if lesser, challenges. International financial crises in Bulgaria, the Czech Republic and Russia in Europe, Argentina and Mexico in Latin America, and Indonesia, Malaysia, the Philippines and Thailand in Asia have made front-page news in the last several years. These crises vividly illustrate the costs of inconsistencies between the domestic and international aspects of national financial policies.This volume deals with the most important international aspect of these challenges to national monetray policies in emerging market economiesthe choice of exchange rate regime. A distinguished group of Western economists and Central European economists and officials review the recent experiences and the former communist and many developing countries and discuss the major lessons to be drawn. }