http://repub.eur.nl/res/aut/5184/ List of Publications en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/12380/ 2003-01-01T00:00:00Z This paper provides evidence that the choice of the foreign exchange regime is not of first order importance for achieving high output growth. It is argued that due to the forward looking nature of the foreign exchange market, exchange rate stability hinges on the current and anticipated coherency of monetary and fiscal policies. We demonstrate this empirically on a panel including potential EMU accession countries. By means of rank regression analysis we uncover the partial links across the regime specifics of the representative country versus the German regime during the 1990s. http://repub.eur.nl/res/pub/6824/ 2002-02-06T00:00:00Z This paper provides empirical evidence that, irrespective of the foreign exchange rate regime, countries with high monetary volatility have lower relative output growth rates. It is argued that due to the forward looking nature of the foreign exchange market, exchange rate stability hinges on the stability of the institutional structure within which monetary and fiscal policies are formulated. Subsequently, the likely endogenous response in the accession countries upon entry into EU and EMU is examined. This provides arguments for a rapid transition phase, possibly complemented by a one sided euroisation as a commitment device