Exchange-rate volatility is a problem for trade … especially when financial development is low

The increasing volatility of exchange rates after the fall of the Bretton Woods agreements has been a constant source of concern for both policymakers and academics. Developed countries fought hard in the 1980s to limit US dollar fluctuation (one thinks of the Plaza and Louvre’s agreements,…

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Exchange-rate volatility is a problem for trade … especially when financial development is low

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