Rodríguez-López, Jesús; Rodriguez Mendizabal, Hugo - In: Contributions in Macroeconomics 6 (2006) 1, pp. 1-25
paper, we provide an explanation of this behavior, labeled by Calvo and Reinhart as fear of floating. First, we analyze the … target zones widened in August 1993. Finally, we solve the model for a subgame perfect equilibrium, in which fear of floating …