In research on the political economy of exchange rates, a good understanding of who will endorse and who will oppose certain exchange-rate policies is central to understanding how actual exchange-rate policies are made and how the global exchange-rate system changes over time. Since existing...

When faced with speculative pressure on their currencies, policymakers often delay devaluations by spending billions of dollars in defense of a given exchange rate peg, only to succumb and devalue their currency later on. Using a political economy approach we argue that the interaction of...