On Crises, International Trade and Exchange Rate Regimes

16 Pages Posted: 22 Jul 2015

See all articles by Francisco Ledesma Rodríguez

Francisco Ledesma Rodríguez

University of La Laguna - Department of Applied Economics

Jorge Pérez Rodríguez

University of Las Palmas de Gran Canaria - Faculty of Economic Science

Maria Santana‐Gallego

University of the Balearic Islands

Date Written: January 15, 2014

Abstract

The main objective of this paper is to study the performance of exchange rate regimes on international trade during crisis episodes. To that end, a gravity equation is estimated for a sample of 194 countries over the period 1970-2011, by adding a set of regressors built from a de facto classification of exchange rate arrangements and the dates of recognized financial crises. This paper studies the behaviour of the different exchange rate regimes in the context of both global and domestic economic crises. The results indicate that sharing a common currency seems to be the best exchange rate arrangements in terms of its effect on trade during crisis episodes. The results also suggest that the fixer the regime is, the more intense is its promoting impact on trade during crises.

Suggested Citation

Ledesma Rodríguez, Francisco J. and Pérez Rodríguez, Jorge and Santana‐Gallego, Maria, On Crises, International Trade and Exchange Rate Regimes (January 15, 2014). Available at SSRN: https://ssrn.com/abstract=2633139 or http://dx.doi.org/10.2139/ssrn.2633139

Francisco J. Ledesma Rodríguez

University of La Laguna - Department of Applied Economics ( email )

Facultad de Ciencias Economicas
Campus de Guajara
38071 La Laguna
Spain
+34 922 31 71 19 (Phone)
+34 922 31 78 53 (Fax)

Jorge Pérez Rodríguez

University of Las Palmas de Gran Canaria - Faculty of Economic Science ( email )

Dpto. de Metodos Cuantitativo Campus de Tafira, Tafira Baja
E-35017 Las Palmas
Spain
+34 928 458222 (Phone)
+34 928-458225 / 1829 (Fax)

HOME PAGE: http://fcee.ulpgc.es/~jorge/

Maria Santana‐Gallego (Contact Author)

University of the Balearic Islands

Crtra. Valldemossa, km 7.5
Ed. Ramon Llull
Palma de Mallorca, Illles Balears 07122
Spain

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