Macroeconomic interdependence and exchange rate regimes in Latin America
- Authors
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Márcio Holland
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Otaviano Canuto
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- Keywords:
- Estabilização econômica, Política cambial
- Abstract
- This paper approaches the macroeconomic mechanisms of shock transmission among Latin American largest economies (Argentina, Brazil, Chile and Mexico) in the .90s. We attempt to show that the heterogeneity of exchange rate regimes among those economies has not implied their national autonomy insofar as monetary policy. As a policy conclusion, we argue that those economies should jointly search for national foreign-liquidity cushions against region-level shocks. Firstly, the paper outlines the heterogeneity of exchange-rate regimes among Latin American economies, as an outcome of stabilization policies and foreign- -exchange crises in the .90s. We then recall some of the arguments regarding the adequacy of exchange-rate regimes that have been raised in the debate on the .international financial architecture.. Afterwards, we present some econometric evidence on macroeconomic transmission of disturbances in Latin America, pointing out that even though different exchange rate regimes have implied different national macroeconomic responses, no one single economy has been able to escape from regionally significant shocks. Our results lead us to suggest that Latin American large economies should jointly attempt to build some regional .liquidity defense. at each national level, given that their financial common fate does not seem to be vanishing, despite efforts of national differentiation.
- Downloads
- Issue
- Vol. 25 No. 2 (2004)
- Section
- Artigos
- License
- A remessa dos artigos à revista implica a cessão dos direitos autorais à FEE.