Robert M. La Follette School of Public Affairs

Choose Your Weapon: International Trade Agreements and Exchange Rate Policy Choice

This paper examines the question of whether governments engage in "exchange rate protection" - that is, whether they actively manipulate the exchange rate and/or utilize exchange rate fluctuations as a lever to influence the terms of trade. Using data on 21 countries from 1975-1999, the paper identifies specific conditions under which governments use exchange rate policy as a substitute for trade protection.

Additional Info

  • Volume or issue no.: La Follette School Working Paper No. 2007-038
  • Author(s): Mark S. Copelovitch and Jon C. Pevehouse