@misc{9817,
title = {Fiscal Discipline and the Choice of Exchange Rate Regime},
author = {Tomell, Aaron and Velasco, Andrés},
year = {2010},
doi = {10.18235/0010747},
abstract = {Conventional wisdom claims that fixed exchange rates provide more fiscal discipline than do flexible rates, but the recent experiences in Europe, the record of Sub-Saharan countries in the 1980s, and the history of stabilization attempts in Latin America cast empirical doubts on this wisdom. To explore this puzzle we present a standard intertemporal model with perfect capital mobility and price flexibility, in which fiscal policy is endogenously determined by a maximizing fiscal authority.},
url = {https://doi.org/10.18235/0010747}
}