Abstract
After massive attacks against the peso in January 2002 the Argentine government abandoned its currency board arrangement. The collapse of the Argentine exchange-rate system initiated a new discussion about the pros and cons of currency boards. Why did the Argentine currency board fail? What does its collapse reveal about the conditions that have to be fulfilled for a currency board to function smoothly? What consequences can be drawn from the Argentine case with regard to the currency boards of countries in central and eastern Europe?
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The BCBA also offered refinancing facilities to commercial banks Cf C. Ho, op. cit.,, p. 14 f.
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M. Mussa, op. cit.,. p. 6, concludes: “To satisfy various political needs and pressures, the government (at all levels) has a persistent tendency to spend significantly more than can be raised in taxes. … the Argentine government is like a chronic alchholic—once it starts to imbibe the political pleasure of deficit spending, it keeps on going until it reaches the economic equivalent of falling down drunk,” According to Meltzer “Argentina’s main problem for decades has been a political system that cannot maintain credible, pro-growth, noninflationary policies.” A.H. Meltzer: Argentina 2002: A case of government failure, in: The Cato Journal, Vol. 23, No. 1, 2003, p. 30.
Cf. C. W. Calomiris, op. cit., Lessons from Argentina and Brazil (What have we learned from the sovereign debt crises and what can the United States and the IMF do to repair the damage, and to avoid similar problems elsewhere?), in: The Cato Journal, Vol. 23, No. 1 2003, p. 37.
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Cf. EU-Commission: Regular Report on Estonia’s progress towards Accession, October 2002, p. 42 f.
Ibid., Cf. EU-Commission: Regular Report on Estonia’s progress towards Accession, October 2002, p. 42 f.
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Brockmann, H., Keppler, H. Do currency boards increase the credibility of exchange-rate pegs?. Intereconomics 38, 328–333 (2003). https://doi.org/10.1007/BF02914023
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DOI: https://doi.org/10.1007/BF02914023