The Political Economy of Exchange Rates

Steinberg, David; Walter, Stefanie

The Political Economy of Exchange Rates

In: Caprio, Gerard (ed.) Handbook of Safeguarding Global Financial Stbility: Political, Social, Cultural, and Economic Theories and Models, Vol. 2. Elsevier: 27-36, Forthcoming

20 Pages Posted: 28 Jan 2015

See all articles by David Steinberg

David Steinberg

University of Pennsylvania - Browne Center for International Politics

Stefanie Walter

University of Zurich - Institute for Political Science

Date Written: 2013

Abstract

Exchange rate policy is influenced by numerous political factors, including the preferences of industries, policymakers, political parties as well as institutional arrangements, such as democracy, elections, the electoral system, the number of veto players and central bank independence. However, none of these factors always matters, and many of them have different effects in different circumstances. Rather, most political factors have contingent effects on exchange rate policy.

Keywords: currency policy, exchange rate policy, monetary policy, political economy, political institutions, preferences

Suggested Citation: Suggested Citation

Steinberg, David and Walter, Stefanie, The Political Economy of Exchange Rates (2013). In: Caprio, Gerard (ed.) Handbook of Safeguarding Global Financial Stbility: Political, Social, Cultural, and Economic Theories and Models, Vol. 2. Elsevier: 27-36, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2497462