Type
Working paper
Titre
Target zones in History and Theory : efficiency, credibility and policy autonomy
Auteur(s)
FLANDREAU Marc - Sciences Po (Auteur)
KOMLOS John - Department of Economics (Auteur)
Collection
CEPR Discussion paper : n°5199
Mots clés
target zone, market efficiency, monetary policy, covered interest parity
Résumé
EN
A natural experiment with an exchange-rate band in Austria-Hungary in the early 20th century provides a rare opportunity to discuss critical aspects of the theory of target zones. Providing a new derivation of the target zone model as a set of nested hypotheses, the inference is drawn that policy credibility and market efficiency were paramount in the success of the Austro-Hungarian experience.
CITATION BIBLIOGRAPHIQUE
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