Marris: Second-Best Responses to Currency Misalignments (Pr Only) (Paperback)

Now available directly from: IIE11 Dupont Circle, NWWashington, DC 20036Tel: (202) 328-9000Currency overvaluations and undervaluations have appeared repeatedly under the postwar regimes of both fixed and flexible exchange rates, have tended to grow rather than diminish; and may well reappear periodically even if the current regime is substantially reformed. This study addresses such alternatives to currency imbalances as direct intervention in the foreign exchange markets, trade controls, border taxes, capital controls, interest equalization taxes, "compensatory finance," and a range of other "second-best" devices, including simply "living with" the imbalance. It reaches judgments concerning their utility under differing national and international circumstances.