Influence of social learning on exchange rate policy in developing countries:a preliminary finding
- 1 May 1998
- journal article
- research article
- Published by Taylor & Francis in Applied Economics
- Vol. 30 (5) , 697-704
- https://doi.org/10.1080/000368498325688
Abstract
By using a suitable econometric model, this study shows that beyond factors postulated by theorists ‘social learning’ is a very powerful phenomenon for guiding developing countries in their exchange rate policy. We introduce two variables that fairly encapsulate features of learning among neighbours. The new variables, together with those advanced in theory are then used to determine choice of a managed float by analysing 1993 cross-section data from Asian developing countries.Keywords
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