Local-currency pricing and the choice of exchange-rate regime

摘要: Abstract Feldstein (1992, The Economist 19–22; 1997, Journal of Economic Perspectives 11, 23–42) invokes Friedman's (1953, Essays in Positive Economics. Chicago University Press, Chicago, pp. 157–203) classic case for flexible exchange rates to argue that the single currency European Monetary Union will hinder adjustments might have occurred through real rate movements under a more system. extent local-currency pricing among countries undermines this view. prices consumers pay imported goods are not much influenced by changes nominal short run. channels adjustment relative price considerably narrowed when predominates. New evidence is presented reaffirms predominance consumer Europe. optimum area analysis reexamined Mundell–Fleming framework with pricing.