Percorrer por autor "Monetha, Darius Noah"
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- Electoral cycles and exchange rate management : evidence from international reserves and currency depreciationPublication . Monetha, Darius Noah; Schliephake, EvaThis thesis investigates the timing of currency depreciation around elections. The focus is both on delayed adjustments and on reserve depletion as a means of maintaining stability. Using a panel dataset covering 104 countries from 1960 to 2024, the analysis combines monthly and quarterly macroeconomic data to capture short-term electoral dynamics. The empirical strategy employs fixed-effects panel regressions and logit models, complemented by robustness checks across institutional and policy environments. The results indicate that electoral cycles shape exchange rate management in subtle but systematic ways. At the monthly frequency, depreciation pressures are significantly lower before elections. They are more likely to materialize immediately afterwards, consistent with the view that incumbents delay politically costly adjustments until the electoral hurdle has passed. In parallel, reserves are systematically depleted in the run-up to elections, pointing to active interventions to sustain stability. However, there is little evidence of systematic reserve accumulation afterwards. These patterns were more pronounced in the 1960-1993 period and have weakened since the 1990s, reflecting stronger institutions and deeper financial globalization, though pre-election reserve losses persist. Electoral cycles are most evident under floating exchange rate regimes, while institutional constraints such as central bank independence and capital account openness mitigate them. Overall, the findings suggest that while globalization and institutional reforms have reduced the scope for opportunistic exchange rate policies, elections continue to influence currency management, primarily through reserve interventions rather than systematic shifts in depreciation timing.