The objective of the article is to determine which exchange rate regime provides higher bilateral trade: fixed rate or currency union. Research Design & Methods: An index was designed based on variables commonly recognised as those that might affect the value of bilateral trade and those that are differently affected by fixed exchange rate regime and currency union. These variables are trade openness, trading partner trade importance, similarities of government debt and borrowing, similarities of inflation, and the correlation coefficient of detrended GDP. The index serves as a dependent variable in the main model, which was created using principal component analysis. I also ran models with both trade openness and trading partner trade importance as dependent variables. Findings: Although the index appeared to be higher in countries with a currency union, the results show that a currency union does not provide higher values of bilateral trade compared to a fixed exchange rate regime. Implications & Recommendations: Research can be repeated with more attention dedicated to independent variables. Alternative de facto classifications of exchange rate regimes can be used for future studies as well.Contribution & Value Added: The article contributes to existing studies on exchange rate regimes that commonly and interchangeably use notions of fixed exchange rate regime and currency union. To my best knowledge, there is no previous empirical research that would separately compare the impact on trade of these notions. The current study fills this gap. Article type:research article

Purpose: This paper aims to explore the relationship of the rate of long-run economic growth expressed through GDP per capita average growth rate during the specified period (dependent variable) to colonizer's past of the states. The ultimate goal of the study is to draw conclusions on significance of the colonizer's past on long-run economic growth among the set of the chosen factors. Design/ Methodology/Approach: For this purpose, econometric regression is estimated with inclusion of variables chosen by Sala-i-Martin, Doppelhofer and Miller (2004) methodology of Bayesian Averaging of Classical Estimates (BACE).Findings: The model specification indicates that there exists no statistically significant effect of past colonial possessions in 1945 on 1960-1996 average rate of growth. Practical Implementation: Results give birth to several potentially promising directions for analysis. Such as improvement and further sophistication of methodology, accounting for Jointness measures from BMA theory and creating joint proxies and/or instrumental variables to address the issue of multicollinearity. Originality/Value: Examination of historical processes, even though not purely economic in nature, does provide an invaluable insight for growth economists, allowing them to account for differences and similarities in states' development paths, assessing properly their relative characteristics, or even serving as an object of the study itself. To the best knowledge of the author, there are a few papers discussing the phenomenon.