Series: IMF Working Papers
Author(s): Nienke Oomes , and Christopher Meissner
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 May 2008
Keywords: exchange rate regime, anchor, network externalities, optimal currency area, exchange rate, exchange rate regimes, trade partners,
What determines the currency to which countries peg or "anchor" their exchange rate? Data for over 100 countries between 1980 and 1998 reveal that trade network externalities are a key determinant. This implies tha...