TY - BOOK ID - 84541358 TI - Sticky Exchange Rates and Flexible Prices : A Heretic View From the Interwar Period AU - Gulde, Anne. AU - Wolf, Holger. PY - 1991 SN - 1462315607 1455223298 PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - Cement KW - Ceramics KW - Commodities KW - Currency KW - Deflation KW - Exchange rate arrangements KW - Exchange rate flexibility KW - Exchange rates KW - Foreign Exchange KW - Foreign exchange KW - Glass KW - Gold KW - Inflation KW - International Monetary Arrangements and Institutions KW - Investment & securities KW - Investments: Metals KW - Metals and Metal Products KW - Price Level KW - Real exchange rates KW - United Kingdom UR - https://www.unicat.be/uniCat?func=search&query=sysid:84541358 AB - Real exchange rate variability tends to be higher under flexible than under fixed exchange rates. The neokeynesian view attributes the higher variability to the combination of volatile nominal exchange rates with sticky prices. The neoclassical approach regards an increased incidence of real shocks as the culprit. We test the crucial assumptions underlying the two models for the interwar period. Prices and exchange rates are found to be equally flexible. We hence reject the neokeynesian sticky price view for our sample period. In contrast, our results are consistent with, while not constituting evidence for, the neoclassical equilibrium approach. ER -