Resource title

Between Two Poles : Matching Trade and Exchange Rate Regimes in Mercosur

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Resource description

The paper reviews exchange rate options for Mercosur countries. We start from the observation that most of the countries in the region have a longstanding tendency to adopt fixed exchange rates, and ask how such a system could best be designed. The Argentine crisis has demonstrated that unilateral currency pegs imply the risk of serious misalignments with other trading partners and subsequent realignments. The standard basket peg is not a solution because of its limited transparency and credibility. We therefore discuss a proposal to create dual currency boards that could be a workable solution for the Mercosur countries.

Resource author

Matthias Busse, Carsten Hefeker, Georg Koopmann

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/19273

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Adapt according to the presented license agreement and reference the original author.