Policy Regime Choice and Implications

The choice of an exchange rate model depends on the empirical relevance and its suitability as well as the nature and choice of the underlying exchange rate regime. Modeling exercises in the previous chapters show that market models do not fit well into the Indonesian data, while the shadow price model has some normative application. These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.