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Alexi Thompson, Department of Economics, Indiana University of Pennsylvania, Indiana, USA

Henry Thompson, Department of Economics, Auburn University, Auburn, Alabama, USA

The Exchange Rate Regime Switch and Current Account in Greece, 1976-2014

Volume 71 - Issue 3, August 2018
(pp. 371-386)
JEL classification: F10, F14, F31
Keywords: Exchange Rate Regime, Greece, Euro Zone, Current Account, Trade Balance


This paper examines the effects of the 2001 switch in exchange rate regimes from the depreciating drachma to the “gold standard” euro in Greece.  In the error correction estimates, the regime break decreases export revenue from goods but also decreases import spending on both goods and services.  International income and payments are not affected.  Depreciation has the same effects under either regime, namely decreased import spending on goods and services and increased export revenue from goods.  The models control for the 2008 government debt crisis that lowered import spending and led to balanced trade.

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Institute for International Economics
of the Genoa Chamber of Commerce

Istituto di Economia Internazionale
Camera di Commercio di Genova
Via Garibaldi, 4 (III piano) - 16124 Genova (Italy)