Market Pressure on Currencies in Crises. Shadow Exchange Rate Experience of Argentina and Switzerland 2011-2015

• Autorzy: Marcin Gruszczyński , Katarzyna Dąbrowska-Gruszczyńska
• Języki publikacji: EN

Abstrakty

EN

Aim/purpose - The aim of this article is to present two cases of exchange rate controls in Switzerland and Argentina. The paper also examines the problem of presence and evaluation of shadow exchange rate in both countries. Design/methodology/approach - The shadow exchange rates are estimated using speculative pressure index concept that emphasizes the importance of not only exchange rate movements but also changes in foreign exchange reserves as well as interest rate differentials. The research sample covers Switzerland 2001-2016 and Argentina 2006-2016 (for shadow exchange rate simulation: 2011-2014 and 2011-2015, respectively). Findings - The conclusions drawn from international experience and conducted empirical analysis are positive. In both cases, shadow exchange rates were close to market rates after the removal of controls. During the restrictions periods shadow rates followed the intuition given by speculative pressure index concept (and by monetary approach, simultaneously). Research implications/limitations - The research suggests that market forces in both countries were still able to restore exchange rates to market values after the period of control. However, it is obvious that it is very difficult to prove that shadow rates were always determined by economical forces and close to their long-term equilibrium values. Originality/value/contribution - The original approach combines two important economic concepts - the idea of shadow exchange rate and the methodology of index of speculative pressure. Combined together they can help to analyze two interesting and relatively new cases of foreign exchange controls in Switzerland and Argentina. The results can be valuable for economists, researchers and politicians who support or reject the idea of controlling macroeconomic parameters in modern, open economy.(original abstract)

Słowa kluczowe

EN

Exchange rates; Financial crisis; Cash flows

PL

Kurs walutowy; Kryzys finansowy; Przepływy pieniężne

• Czasopismo: Journal of Economics & Management / University of Economics in Katowice
• Rocznik: 2017
• Numer: nr 30
• Strony: 58--69

Twórcy

autor

Marcin Gruszczyński

• University of Warsaw, Poland

autor

Katarzyna Dąbrowska-Gruszczyńska

• University of Warsaw, Poland

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Identyfikatory

DOI

10.22367/jem.2017.30.03