Previous studies on whether the nature of the exchange rate regime influences a country's medium‐term growth performance have been based on a tripartite classification scheme that distinguishes between pegged, intermediate and flexible exchange rate regimes. This classification scheme, however, leads to a situation where two of the categories (intermediate and flexible) characterize solely the exchange rate regime, whereas the third (pegged) characterizes both the exchange rate regime and the monetary policy framework. Our study refines this classification scheme by accounting for different monetary policy frameworks, classifying monetary arrangements based on the presence of an explicit monetary policy ‘anchor’, such as the exchange rate or other targeted nominal variable. We estimate the impact of exchange rate arrangements on growth in a panel‐data set of 60 countries over the period 1973–1998. We find evidence that exchange rate regimes characterized by a monetary policy anchor, whether they are pegged, intermediate, or flexible, exert a positive influence on economic growth. We also find evidence that intermediate/flexible regimes without an anchor are detrimental for growth. Our results thus suggest that it is the presence of a monetary policy anchor, rather than the type of exchange rate regime per se, that is important for economic growth. Furthermore, our work emphasizes the importance of considering the monetary policy framework that accompanies the exchange rate arrangement when assessing the macroeconomic performance of alternative exchange rate regimes.

This paper revisits the relationship between energy prices and the Canadian dollar in the Amanovan Norden (1995) equation which showed a negative relationship such that higher real energy prices led to a depreciation of the Canadian dollar. Based on structural break tests, we find a break point in the sign of this relationship, which changes from negative to positive in the early 1990s. The break in the effect between energy prices and the Canadian dollar is consistent with major changes in energy-related cross-border trade and in Canada's energy policies. RésuméL'effet des prix des produits énergétiques sur le dollar canadien identifié par Aamno et van Norden (1995) est ré-examiné dans ce document de travail. Ces derniers avaient trouvé une relation négative entre les deux variables, telle qu'une hausse des cours des prix énergétiques conduit à une dépréciation du dollar canadien. En testant pour des bris structurels dans l'équation, nous découvrons que la relation a changé de signe dans le temps. Initialement négative, la relation tourne positive au début des années 1990. Le changement de la relation reflète, selon nous, l'évolution du commerce frontalier des produits énergétiques et l'assouplissement de la réglementions dans le secteur au fil du temps.

No abstract

No abstract

No abstract