Globalization, Macroeconomic Performance, and the Exchange Rates of Emerging Economies
38 Pages Posted: 2 Nov 2004 Last revised: 25 Aug 2022
Date Written: October 2004
Abstract
Among the developing countries of the world, those emerging markets that have sought some degree of integration into world finance are characterized by higher per capita incomes, higher long-run growth rates, and lower output and consumption volatility. These characteristics are more likely to be causes than effects of financial integration. The measurable gains from financial integration appear to be lower for emerging markets than for higher-income countries, and appear to have been limited by recent crises. One factor limiting the gains from financial integration is the difficulty emerging economies face in resolving the open-economy trilemma. Given their structural and institutional features, many emerging economies cannot live comfortably either with fixed or with freely floating exchange rates. Most recently, the exchange rates of several emerging countries display attempts at stabilization punctuated by high volatility in periods of market stress.
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Holding International Reserves in an Era of High Capital Mobility
-
International Reserves: Precautionary Versus Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
International Reserves: Precautionary Versus Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
Seigniorage and Political Instability
By Alex Cukierman, Sebastian Edwards, ...
-
International Reserves: Precautionary vs. Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
The High Demand for International Reserves in the Far East: What's Going on?
-
The High Demand for International Reserves in the Far East: What's Going on?
-
The Optimal Level of International Reserves for Emerging Market Countries: Formulas and Applications
By Olivier Jeanne and Romain G. Rancière
-
The Social Cost of Foreign Exchange Reserves
By Dani Rodrik
-
The Social Cost of Foreign Exchange Reserves
By Dani Rodrik