Exchange rate policy as a public policy: An inquiry into policy images

Abstract

An exchange rate at the “right level” is of paramount importance for economic development, according to the new developmentalism. The portrayal of exchange rates in the media may serve as a proxy for the current policy images, and the media can also shape the policy images held by the public. The methodology of this paper is based on the content analysis of editorials from Folha de S. Paulo. The depreciated exchange rate is usually viewednegatively. An exchange rate policy that tries to maintain the exchange rate depreciated or avoid its appreciation often carries a negative policy image. For such a policy to gain traction in the public agenda, it would need a positive policy image portraying a depreciated exchange rate as beneficial for enhancing the competitiveness of domestic companies, increasing income, and creating more and higher-paying jobs.