Aim/purpose – The aim of this article is to present two cases of exchange rate controls in Switzerland and Argentina. The paper also examines the problem of presence and evaluation of shadow exchange rate in both countries. Design/methodology/approach – The shadow exchange rates are estimated using speculative pressure index concept that emphasizes the importance of not only exchange rate movements but also changes in foreign exchange reserves as well as interest rate differentials. The research sample covers Switzerland 2001-2016 and Argentina 2006-2016 (for shadow exchange rate simulation: 2011-2014 and 2011-2015, respectively). Findings – The conclusions drawn from international experience and conducted empirical analysis are positive. In both cases, shadow exchange rates were close to market rates after the removal of controls. During the restrictions periods shadow rates followed the intuition given by speculative pressure index concept (and by monetary approach, simultaneously). Research implications/limitations – The research suggests that market forces in both countries were still able to restore exchange rates to market values after the period of control. However, it is obvious that it is very difficult to prove that shadow rates were always determined by economical forces and close to their long-term equilibrium values. Originality/value/contribution – The original approach combines two important economic concepts – the idea of shadow exchange rate and the methodology of index of speculative pressure. Combined together they can help to analyze two interesting and relatively new cases of foreign exchange controls in Switzerland and Argentina. The results can be valuable for economists, researchers and politicians who support or reject the idea of controlling macroeconomic parameters in modern, open economy.
In their analyses devoted to the directions of international capital flows, economists dealing with the subject often make references to conclusions reached by R. Lucas Jr, i.e., to the so called Lucas paradox. In literature, Lucas paradox provides the starting point for considerations on how neoclassical model works when it comes to the directions and volume of capital flowing among countries in modern global economy. This paper aims at discussing the rationale behind the study conducted by R. Lucas Jr and, consequently, the justification for his conclusion. Lucas paradox is considered in two approaches: classical, i.e., consistent with conclusions drawn by R. Lucas: capital flows between countries in amounts smaller than suggested by differences in marginal products of capital in individual countries and the flow does not equalise them; and contemporary: directions of capital flows in global economy are not consistent with those delineated by the neoclassical model, capital flows from poor (developing) countries to rich (developed) ones. Taking account of neoclassical model assumptions, in both approaches to Lucas paradox drawing "hard" conclusions with respect to directions of capital flows in contemporary economy based on quoted studies does not seem justified.(original abstract)
Od początku lat 90. XX w. większość państw Europy Środkowo-Wschodniej poddanych było procesowi transformacji gospodarczej, której ważną cechę stanowiła odbudowa sektora finansowego działającego na zasadach rynkowych. Towarzyszy temu daleko idąca realizacja idei integracji bardziej i mniej rozwiniętych części naszego kontynentu pod auspicjami Unii Europejskiej (UE). Wśród filarów UE należy wymienić dążenie do ustanowienia wspólnego rynku, pozbawionego (z zasady) przeszkód w międzynarodowym przepływie dóbr rzeczowych, kapitału i usług. W związku z tym europejskie państwa zaliczane do rynków wschodzących zadeklarowały i wdrożyły politykę otwierania się na międzynarodowy przepływ strumieni finansowych. Świadectwem takich tendencji jest silna obecność kapitału zagranicznego w krajowych sektorach bankowych Europy Środkowo-Wschodniej. Jednak światowy kryzys gospodarczy, który (rozpoczynając się w państwach wysoko rozwiniętych) bardzo negatywnie odbił się na gospodarce państw okresu transformacji, zmusił do zastanowienia się, czy kapitałowa zależność banków od zagranicznych korporacji finansowych stanowi istotny czynnik przenoszenia turbulencji z rynku międzynarodowego do krajowego sektora finansowego. Artykuł poświęcono próbie odpowiedzi na to pytanie. (fragment tekstu)
EN
The purpose of this paper is to estimate empirically the relations between credit growth and the presence of foreign banks in the East-Central European countries. A sample of 152 banks from eleven countries (Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia) is used in the analysis. The panel estimation technique is used in regressions. The research results show that foreign banks entry can raise credit growth, but it is also connected with some negative effects, because foreign banks can be treated as a transmission channel of turbulence in international financial markets. (original abstract)
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