The book addresses three aspects of exchange rate regime choice: the factors determining regime choice, regime classification, and the relationship between exchange rate regimes and macroeconomic performance. The starting point is to illustrate the role played by the exchange rate in the economy. The classical debate on the fixed versus flexible exchange rates is discussed comprehensivley from a theoretical perspective. This is followed by two chapters on the classification of exchange rate regimes and related issues such as the bipolar view, the exit problem and the verifiability problem. The book also considers the history of exchange rate arrangements and presents a selective survey of the models used to determine regime choice and related issues. A final chapter is devoted to case studies, one of which is based on the author's actual experience when he visited Baghdad in 2003 as an advisor to the U.S. Treasury.