Money: A New Way to Reform

To heads of governments, currency devaluation is a devilish thing, to be resisted to the bitter end. It not only dam ages national pride but also depletes the pocketbooks of voters by forcing them to pay more for imported goods and foreign travel. Despite those draw backs, policymakers are becoming in creasingly interested in a scheme for making devaluations—and upward revaluations—fairly common.

The plan has the particularly unattractive name of "crawling peg," but it has a notably attractive list of advocates. It was popularized largely by Princeton Economist Fritz Machlup, and lately...

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