This paper is written to address the problem of having floating or fixed exchange rates. My results showed that between 2008 and 2009, having a free floating exchange rate actually worsened the percentage change in GDP per capita by -2.58331 %. On the other hand, a second regression analysis estimated that a floating exchange rate increased the percentage change in GDP per capita between 2008 and 2009 by 2.8914 %.

The estimate was not however statistically significant at any of the standard significance levels.

By taking the two extremes perhaps one could investigate a superior exchange rate regime in terms of protecting against global economic crisis. Many countries have chosen to adopt a managed floating instead but these were not looked at very thoroughly in the paper.