1 option
Target Zones with Limited Reserves / Paul Krugman, Julio Rotemberg.
- Format:
- Book
- Author/Creator:
- Krugman, Paul.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w3418.
- NBER working paper series no. w3418
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1990.
- Summary:
- Like a fixed exchange rate, a target zone system may be subject to speculative attacks when the reserves of the central bank are limited. This
- paper analyzes such speculative attacks and their implications; it shows that the recently developed "smooth pasting" model of target zones should be viewed as a special case that emerges only when reserves are sufficiently large. The paper then uses the target zone framework to resolve a seeming paradox in predicting speculative attacks on a gold standard, arguing that such a standard may best be viewed as the boundary between one-sided target zones.
- Notes:
- Print version record
- August 1990.
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