Target zones for the US dollar?

The discussion of target zones for flexible exchange rates is evidence of the desire to experiment with new instruments for stabilising the international monetary system. What distinguishes target zones from systems of flexible and fixed exchange rates? What form should they take? How should one regard the various objections to target zones?     

International trade in a system of floating exchange rates

Since the introduction of the system of floating exchange rates policy-makers have been troubled by uncertainties regarding the effects of this system on international trade. Do exchange rate changes affect trade flows? Can governments manipulate exchange rates? Have countries been “injured” by exchange rate changes? What are the real costs of international monetary instability? Answers to these key questions are given in the following article.     

Unstable exchange rates and trade policy

Floating exchange rates affect two basic principles of GATT, namely: stability of trade policy conditions and reciprocity of trade concessions. What is the relevance of the changes to foreign trade? What possibilities for surmounting the new problems exist in the realm of external economic relations?     

Macroeconomic adjustment: the Baltic states versus euro area crisis countries

Estonia, Latvia and Lithuania have succeeded in rapidly reducing their current account deficits despite fixed exchange rates. Which factors have played a major role in this? What similarities, and what differences, do the Baltic states show compared to Greece and Portugal? What insights can be gained for the political debate on the euro area debt crisis?     

EMS: a model for a world monetary order?

In the debate about the world monetary order there is agreement that greater stability in international currency relationships would be desirable. Could a system of fixed exchange rates between the currencies of the major industrial countries put an end to the present instability? What would be the advantages and weaknesses of such a system modelled on the EMS?     

The European Monetary System as a factor of integration

Critics of the EMS claim that it has failed to realise the hopes aroused at the time of its inception; a convergence of economic policies, they maintain, has not been induced by fixed exchange rates. What is the true position with regard to the convergence of economic policies?     

Issues of European monetary integration

In recent years significant progress has been made towards European monetary integration. Widespread agreement as to the role of monetary policy has been established and there were no realignments of exchange rates within the European Monetary System between March 1983 and July 1985. This was the longest period without realignment in the EMS and contrasted sharply with the six realignments observed in the four years previously. What are the prospects for the further strengthening of the EMS? How can the present system be developed further?     

Exchange rates and the volume of trade—The case for fixed exchange rates

Exchange rate volatility and long-term distortions of exchange rate levels have given rise to concern among participants in international trade. Do exchange rate fluctuations have an adverse impact on the volume of trade? What measures could be taken to achieve greater exchange rate stability?     

The US dollar- scenario of a world currency

The exchange rate of the US dollar fell sharply last year. What part was played by the adverse “fundamentals” of the US economy, the large current account deficit, the country’s heavy foreign indebtedness and the substantial budget deficit? How will the dollar behave in future?     

Twenty years of flexible exchange rates: Experiences and developments

The Bretton Woods system of fixed exchange rates was abandoned at the beginning of March 1973 when currencies were allowed to float. Has the system of flexible exchange rates fulfilled the expectations placed in it? How should experiences with regional systems of fixed exchange rates be assessed, and what are the prospects for a return to such a system worldwide?     

How to combat NEET? Evidence from Austria

The number young people not in education, employment or training (NEET) has been rising since the beginning of the economic and fi nancial crisis in 2008. This article contributes to the discussion about the reduction of the NEET rate by addressing the questions: Which structural factors can explain differences in the NEET rates among Austrian federal states? What causes an increased or reduced NEET risk at the individual level? What are the key factors for an exit from a NEET situation?     

The US current account deficit: A fundamentally flawed development?

The American current account deficit has once more become the subject of public debate. The size of the deficit is seen by some observers as the main cause of the recent decline in the exchange rate of the dollar. Can the latter be taken as confirmation of the increasing warnings that, in view of the dependence of the US economy on capital imports, adjustment processes such as a dramatic slump in the dollar exchange rate are imminent? What fundamental developments lie behind the US current account deficit, and do they give cause for significant adjustment reactions?     

Economic and social turbulence in Greece: the product markets are a no-brainer,the labour market is not

Since the 1990s the Greek economy has posed a unique international paradox, combining relatively strong growth rates with a very weak performance on many other fronts ranging from poor labour and product market institutions and low competitiveness to poor environmental protection and high levels of corruption. The recent economic and social turbulence in Greece is a result of this paradox. What is the explanation for this situation? What reforms are necessary to change it?     

Creating sustainable international social ventures

International social ventures are now an increasingly common feature of the international business and social landscape in many countries worldwide. However, despite the increase in the number of social ventures and widespread interest that has resulted, theoretical development that deals specifically with international social ventures, or social ventures that operate across borders, has lagged behind, and there is little to guide potential social entrepreneurs thinking of setting up an international social venture. The aim of this article is to show how combining concepts from social exchange theory with international new venture theory can provide a useful conceptual framework that helps answer the central questions: What are the conditions for sustainable international social ventures? What difficulties are likely to arise in establishing such ventures? © 2012 Wiley Periodicals, Inc.     

Do “blacklists” enhance aviation safety?

For some time now, discussions have been under way in the EU on the possible publication of an official “blacklist” of unsafe airlines or countries where accident rates are above average. How effective is this instrument? What are the conceivable alternatives?     

Occupational segregation in Spain: Differential treatment of immigrants

Spain today faces simultaneously one of the world's largest immigrant populations and one of the highest unemployment rates. This difficult dilemma makes it a test case for how rich countries should deal with a surplus immigrant population. Do Spanish markets and policies make it more difficult to absorb immigrants? What policies could help? What are the consequences if the challenge is not faced successfully? This article focuses on the occupational segregation between Spanish and foreign workers. It explores whether observed characteristics (gender, age, and education) aggravate segregation, and suggests policies to promote inclusion of immigrants in developed countries. © 2012 Wiley Periodicals, Inc.     

A new world order: explaining the international diffusion of the gold standard, 1870-1913

The gold standard gradually became an international monetary regime after 1870. Similarly, some nations in the European Union are waiting to adopt the euro while others have joined immediately. What explains the timing of exchange rate regime adoption? To find out, the international diffusion of the gold standard is analyzed. Duration analysis shows that network externalities operating through trade channels, the desire to decrease borrowing costs on international capital markets, and the level of development matter. Some evidence shows that the level of exchange rate volatility or inflationist agricultural interests did not matter for the timing of adoption.     

Effects of the flexible exchange rate system on developing countries

The Bretton Woods system of fixed exchange rates was abandoned by the industrialised countries in March 1973. They switched to a system of flexible exchange rates. Representatives of the developing countries were particularly critical of the industrialised countries’ exchange rate flexibility. They saw themselves not only bearing the brunt of the costs associated with balance of payments readjustments but also faced with greater fluctuations both in prices and terms of trade and with other negative effects due to the general increase in uncertainty regarding exchange rates. Are such fears justified?     

Financial markets at the crossroads: Fears of a great crash

Not so long ago the international financial markets were being acclaimed as the cure-all for debt crises and interest rate and exchange rate risks, but new developments are giving increasing cause for concern, as the Deutsche Bundesbank¹ noted recently. Pessimists are spreading a mood of disaster and are already predicting the collapse of the world financial system.² What is the basis for such fears? How serious is the danger of a crash?     

On the Causes and Effects of Exchange Rate Volatility on Economic Growth: Evidence from Ghana

What drives exchange rate volatility, and what are the effects of fluctuations in the exchange rate on economic growth in Ghana? These questions are the subject matter of this study. The results showed that while shocks to the exchange rate are mean reverting, misalignments tend to correct very sluggishly, with painful consequences in the short run as economic agents recalibrate their consumption and investment choices. About three quarters of shocks to the real exchange rate are self-driven, and the remaining one quarter or so is attributed to factors such as government expenditure and money supply growth, terms of trade and output shocks. Excessive volatility is found to be detrimental to economic growth; however, this is only up to a point as growth-enhancing effect can also emanate from innovation, and more efficient resource allocation.