We test a simple model of exchange rate regime choice with data for 65 non-OECD countries covering the period 1980-94.We find that the variance of output at home and in potential target c ountries as well as the correlation between home and foreign real activity are powerful and robust...

In this paper we argue that in contrast to the conclusion of Artis and Zhang, there is not much evidence in support of the view that increased exchange rate stability is related to more synchronised business cycles in Europe. This finding may have important consequences, as existing differences...

Recommended readings (Machine generated): 1. Daron Acemoglu and Simon Johnson (2005), 'Unbundling institutions', Journal of political economy, 113 (5), October, 949-95 1 -- 2. Daron Acemoglu, Simon Johnson and James A. Robinson (2001), 'The colonial origins of comparative development: an...