The credibility of exchange rate target zones for four EMS countries for the period March 1979-September 1992 is … did not predict the September 1992 EMS crisis. However, we find that electoral and other institutional variables improve …

reduces the frequency of central bank intervention. The introduction of a target zone regime significantly reduces exchange …

The EMS is modeled as imposing dual reflecting barriers on the exchange rate process. This policy leads to a state …

market inferes the probability of a realignment of the band on the basis of a noisy signal. We show theoretically and through …

foreign one. The central bank can purchase and sell the foreign currency, and each intervention on the exchange market leads … intervention) as an Ornstein-Uhlenbeck process, and the marginal costs of controls are constant. The techniques employed in the …

The target zone model by Krugman (1991) assumes that foreign exchange intervention targets exchange rate levels. We … argue that the fit of this model depends on the stage of development of capital markets. Foreign exchange intervention of … reduce the risk for short-term and long-term payment flows. Estimations of foreign exchange intervention reaction functions …

The target zone model by Krugman (1991) assumes that foreign exchange intervention targets exchange rate levels. We … argue that the fit of this model depends on the stage of development of capital markets. Foreign exchange intervention of … reduce the risk for short-term and long-term payment flows. Estimations of foreign exchange intervention reaction functions …