Topic
Currency
About: Currency is a research topic. Over the lifetime, 26697 publications have been published within this topic receiving 485370 citations. The topic is also known as: monetary unit & unit of money.
Papers published on a yearly basis
Papers
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TL;DR: This paper explored the pros and cons for different countries to adopt as an anchor the dollar, the euro, or the yen and addressed the question of how trade and comovements of outputs and prices would respond to the formation of a currency union.
Abstract: As the number of independent countries increases and their economies become more integrated, we would expect to observe more multicountry currency unions. This paper explores the pros and cons for different countries to adopt as an anchor the dollar, the euro, or the yen. Although there appear to be reasonably well-defined euro and dollar areas, there does not seem to be a yen area. We also address the question of how trade and comovements of outputs and prices would respond to the formation of a currency union. This response is important because the decision of a country to join a union would depend on how the union affects trade and comovements.
406 citations
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TL;DR: In this article, the authors analyze how changes in balance sheets of some 2800 banks in 48 countries over 2000-2010 respond to specific macro-prudential policies, and find that measures aimed at borrowers such as caps on debt to income and loan-to-value ratios, and limits on credit growth and foreign currency lending are effective in reducing leverage, asset and noncore to core liabilities growth during boom times.
404 citations
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TL;DR: In this article, a cross-generational framework for analyzing currency crises is proposed, which draws from both the early first-generation work and the more recent second-generation approach, emphasizing the important role of speculators and recognizing that the government's commitment to a fixed exchange rate is constrained by other policy goals.
Abstract: In the 1990s, currency crises in Europe, Mexico and Southeast Asia have drawn worldwide attention to speculative attacks on government-controlled exchange rates. To improve our understanding of these events, researchers have undertaken new theoretical and empirical work. In this paper, we provide some perspective on this work and relate it to earlier research in the area. Then we derive the optimal commitment to a fixed exchange rate and propose a common framework for analyzing currency crises that draws from both the early first-generation work and the more recent second-generation approach. The cross-generational framework stresses the important role of speculators and also recognizes that the government's commitment to a fixed exchange rate is constrained by other policy goals. In the final section we study the crisis prediction literature and find that some crises may be particularly difficult to predict using currently popular methods.
401 citations
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TL;DR: The authors developed an equilibrium model in which exchange rates, stock prices and capital flows are jointly determined under incomplete forex risk trading, showing that higher returns in the home equity market relative to the foreign equity market are associated with a home currency depreciation and net equity flows into the foreign market are positively correlated with a foreign currency appreciation.
Abstract: We develop an equilibrium model in which exchange rates, stock prices and capital flows are jointly determined under incomplete forex risk trading. Incomplete hedging of forex risk, documented for US global mutual funds, has three important implications: 1) exchange rates are almost as volatile as equity prices when the forex liquidity supply is not infinitely price elastic; 2) higher returns in the home equity market relative to the foreign equity market are associated with a home currency depreciation; 3) net equity flows into the foreign market are positively correlated with a foreign currency appreciation. The model predictions are strongly supported at daily, monthly and quarterly frequencies for 17 OECD countries vis-a-vis the US. Moreover, correlations are strongest after 1990 and for countries with higher market capitalization relative to GDP, suggesting that the observed exchange rate dynamics are indeed related to equity market development.
393 citations
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30 Nov 2003
TL;DR: In this article, the authors present a history, facts and institutions of the European Monetary Union (EMU) and the Eurozone in crisis, as well as a discussion of the economic integration of the EMU.
Abstract: Part 1: History, Facts and Institutions 1. History 2. Facts, Law, Institutions and Budget 3. Decision Making Part II: The Microeconomics of Economic Integration 4. Essential Microeconomics Tools 5. The Essential Economics of Preferential Liberalization 6. Market Size and Scale Effects 7. Growth Effects and Factor Market Integration 8. Economic Integrations, Labour Markets and Migration Part III: EU Micro Policies 9. The Common Agricultural Policy 10. Location Effects, Economic Geography and Regional Policy 11. EU Competition and State Aid Policy 12. EU Trade Policy Part IV: The Macroeconomics of Monetary Integration 13. Essential Macroeconomic Tools 14. Essential Facts of Monetary Integration 15. Optimum Currency Areas Part V: EU Monetary and Fiscal Policies 16. The European Monetary Union 17. Fiscal Policy and the Stability Pact 18. The Financial Markets and the Euro 19. The Eurozone in crisis
390 citations