... to exchange rate regimes do matter and affect outcomes. Economic theory and monetary autonomy are a limited means of setting interest rates. Pegging countries, therefore, should instead follow the interest rate policy of their base country. Exchange rate regimes are indeed important and require consideration...

... Rogoff K S Summers L H Aghion P Alesina A Aziz J Bacchetta P Banerjee A Barajas A borrowing Bubula A Calvo G A Caramazza F credibility Erikson L Esaka T fear of appreciation fear of floating fear of pegging Ghosh A R Goldstein M Gulde A M Hausmann R inflation Klein M W Larraín F B...

.... In conclusion, the chapter tries to show the demerits of pegging and how it promotes an expansion of bilateral trade with the base country. Bilateral exchange rates Bretton Woods system Committee for the Study of Economic and Monetary Union Crises Currency Delors Jacques Delors Committee Devaluation...