UACS Collection of Abstracts 2011 - University American College ...

KeywordsJEL classificationMacedonia, export, gravity model, Lisbon Treaty, EU economic integrationF13, F15, F41Author(s)Journal of paperappearanceConference of paperappearanceTitle of the paperAbstractKeywordsJEL classificationMarjan PetreskiInternational Journal of Money and Banking, 3(1), p.69‐99.The XVth Spring Meeting of Young Economists (SMYE‐2010), University ofLuxemburg, Luxembourg, 15‐17. April 2010.Exchange‐rate regime and output volatility: Empirical investigation withpanel data.The study aims to explore the relationship between exchange‐rate regimesand output volatility, building on the flaws of the existing, though scarceliterature. It discusses the measure of output volatility; explores theendogeneity bias doubted to be present in the literature; tests nondynamicvs. dynamic model. The empirical investigation covers the post‐Bretton‐Woods era (1976–2006) and includes 169 countries. It is foundthat sufficiently large terms‐of‐trade shocks will spur output volatilityunder fixed, limited‐flexible and flexible exchange‐rate regime as comparedwith a floating regime, but the marginal effect is estimated to be the mostsevere under a peg (longer than five years).exchange‐rate regime; output volatility.Author(s)Journal of paperappearanceConference of paperappearanceTitle of the paperAbstractMarjan PetreskiFIW Working Paper N° 57.Chicago Workshop on Institutional Analysis, Chicago, Illinois, USA, May 15‐21, 2011.An Overhaul of a Doctrine: Has Inflation Targeting Opened a New Era inDeveloping‐country Peggers?The aim of this paper is to empirically examine the effect of a regimeswitch, from exchange‐rate targeting (fixed exchange rate) to inflationtargeting, on monetary policy in developing economies, hence adding toevidence on whether inflation targeting along with a managed floatprovides a better monetary policy compared to exchange‐rate targeting.For this purpose, a group of developing countries that have historicallyexperienced such a switch is analysed. This is done by an augmentedinterest‐rate rule a‐la Taylor (1993; 2001). Two methodological approachesare used: switching regression and Markov‐switching method. Althoughboth approaches have different drawbacks which compensate, still bothlead to the conclusion that inflation targeting represented a real switch indeveloping countries. The period of inflation targeting was characterizedby: a more stable economic environment; by more independent monetarypolicyconduct; and by strict focus on inflation. Estimates suggest that the10