Feuerstein, Switgard; Grimm, Oliver - Center for Globalization and Europeanization of the … - 2004
-consuming legislative process and an abolition will thus be previously expected. Therefore, a currency board solves the time inconsistency … shocks makes the abolition more likely. Currency boards are more credible than standard pegs if the time inconsistency … problem of monetary policy. However, policy can react to unexpected shocks only with a time lag, thus the threat of large …
