Abstract:
In the context of the widespread adoption of flexible exchange rates, the
purposes of this paper are, first, to go over the well-tilled ground of the
principles of balance-of-payments adjustment, trying to interpret these
principles in ways relevant to current conditions, and second to discuss some
recent cases in which balance-of-payments adjustment policies have been
used. The paper offers a number of conclusions about the role of exchange rates
in balance-of-payments adjustment.
The views expressed in this publication are those of the authors and do not necessarily reflect the views of the BIS or its member central banks.