Output divergence in fixed exchange rate regimes

• 成果类型: Article
• 署名作者: Chen, Yao; Ward, Felix
• 署名单位: Erasmus University Rotterdam - Excl Erasmus MC; Erasmus University Rotterdam; Centre for Economic Policy Research - UK; Tinbergen Institute
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2025.104115
• 发表日期: 2025
• 关键词: Nominal exchange regime neutrality; open economy; Nominal frictions

摘要

This paper presents empirical evidence for the violation of nominal exchange regime neutrality. We find that fixing the exchange rate is associated with real output losses among countries with a high pre-peg inflation rate. In particular, ten years after fixing the exchange rate a country with a +1 percentage point (ppt) pre-peg wage inflation differential has a 2% lower real GDP per capita level and a 1% lower TFP level. The tradable sector is more affected than the non-tradable sector, which accords with the former's greater exposure to international arbitrage.