Financial Globalization and Exchange Rates

The founders of the Bretton Woods System sixty years ago were primarily concerned with orderly exchange rateadjustment in a world economy that was characterized by widespread restrictions on international capitalmobility. In contrast, the rapid pace of financial globalization during recent years poses new challenges for theinternational monetary system. In particular, large gross cross-holdings of foreign assets and liabilities meansthat the valuation channel of exchange rate adjustment has grown in importance, relative to the traditional tradebalance channel. Accordingly, this paper empirically explores some of the inter-connections between financialglobalization and exchange rate adjustment and discusses the policy implications.Financial integration, capital flows, external assets and liabilities

Democratic institutions versus autocratic regimes: The case of environmental policy

The literature suggests that democracy positively affects environmental policy stringency. Using the method of propensity score matching, we find that this result appears to be largely driven by the parliamentary democracies (as opposed to the presidential-congressional, proportional or majority systems). Moreover, it appears that presidential-congressional systems often set environmental policies not significantly different from autocracies. These are novel contributions to the literature. Copyright Springer Science+Business Media, LLC 2007Political institutions, Democracy, Environmental policy, Propensity score matching,