Divested interests: Globalization and the new politics of exchange rates.

摘要

I argue that globalization is changing the politics of exchange rates in two fundamental but conflicting ways. On the one hand, globalization has made more salient the policy decisions that influence exchange rates, as more firms and their workers become more dependent on international trade and investment for their livelihood. On the other hand, globalization provides firms with multiple opportunities to manage their exchange rate risk, through A (1) operational hedging (moving production to other countries); and (2) financial hedging (exchange rate forwards and futures). Hedging depresses political contestation on exchange rates, but only for certain firms and in certain situations of exchange rate risk. In this way, globalization explains much of the variation witnessed in the political contestation of exchange rates over time and across space.