| The choice of exchange rate system has not only been the focus of controversy in the international financial field, but also a question that has troubled a country’s economic and financial development for many years. Since 1880 s, when was called gold standard system, there has been a debate of which is superior to choice on the two exchange rates----the fixed exchange rate system and the floating exchange rate system. But the scholars has not found the definite answer to this question yet.Since the collapse of the Bretton Woods system, the fixed exchange rate system is no longer mandatory, and countries can choose the appropriate exchange rate system according to the actual economic situation. However,we can find that there still be 91 countries put the fixed exchange rate system into practice, 67 countries carry out the intermediate exchange rate regime, only 28 countries implement the floating exchange rate regime until 2010 according to the RR regime classification data. Both developing countries and developed countries implemented the fixed exchange rate regime. What is the reason of this situation? Does the fixed exchange rate system has a comparative advantage? What are the factors that affect a country to choice the fixed exchange rate system? Chinese reformed the exchange rate in July 2005. Since then, is the RMB exchange rate system still prefer to the fixed exchange rate system? Based on this research background, from the theoretical and empirical point of view, this paper analyzes the factors which influence a country to choose the fixed exchange rate system.The main purpose of this paper is to analyze the factors that influence a country to choose the fixed exchange rate regime. In order to explore this problem, this paper puts the methods of literature reference, normative analysis combined with empirical analysis, inductive analysis combined with logical analysis to use. The whole article is divided into five chapters, three parts. The first part is the theoretical part. It contains the chapter one, two, three. The chapter one mainly reviews and summarizes the existing literatures home and abroad. The chapter two defines the concept of the fixed exchange rate regime starting from the history of international exchange rate system. The third chapter is the theoretical basis of the paper. It introduces the traditional and developed theories related to the choice of exchange rate system, mainly including the Mundell Fleming Model to represent the policy collocation theory, the optimal currency area theory as a representative of the economic structure theory, the nominal anchor theory and the “fear of floating†theory, two poles theory and so on. These theories are the foundation of the subsequent empirical analysis. Through the study of the above three chapters, we can summarize the factors from theory. They are economic scale, economic development level, capital flows, economic openness, product diversification, inflation,monetary policy independence, international reserves, economic shocks and financial market mature degrees and so on. The chapter four is the second part. It is the empirical part of this paper and is the key point of the full text. Based on the RR classification of exchange rate regime, this paper puts 22 developed countries and 40 developing countries’ data as samples from 1973 to 2010, and establishes a bivariate probit panel data model to analyze. And the conclusions answer the following three questions. What are the factors that influence a country to choose the fixed exchange rate system? How is the factor to affect? And what is the probability for developed countries and developing countries choosing the fixed exchange rate regime? The fifth chapter is the third part. This part analyzes the reform of Chinese exchange rate system and estimates the probability of the selection of fixed exchange rate regime in recent years. The result shows that from 1990 to 2014, the probability of our country choosing the fixed exchange rate system is getting lower and lower. The probability of 2005 dropped to 6%,and the probability down to 1% in 2014. The result is consistent with the reality of the situation in China. It also shows that since July 2005 the RMB exchange rate is gradually prefer to a more flexible exchange rate regime rather than fixed exchange rate system.There are two innovations in this paper. First, the research perspective is novel.The scholars did not distinguish the specific exchange rate system to research, and they always put the three exchange rate regimes together to research. However, this paper chooses the single fixed exchange rate system to research. Second, the empirical research goes a step further. Based on the related study, this paper establishes a bivariate probit panel data model to analyze the probability of choosing a fixed exchange rate regime. However, this paper also has some deficiencies that need to be improved. First,this paper abandons some variables in the empirical analysis because of the missing data of product diversification and financial market mature degree. What’s worse, it is difficult to translate the policy variable monetary policy independence into quantitative variable. Second, this paper only selects a part of developed and developing countries as samples because of the lack of data. The empirical results will be further optimized if all countries are taken into account in the empirical research. |
