That’s the title of my new Mercatus working paper. Here’s the abstract:

Concern over currency manipulation plays a major role in international economic diplomacy. Unfortunately, the concept is not well defined, and the most coherent explanations apply to a concept more accurately termed “saving manipulation,” as it has little to do with market exchange rates. I argue that the costs of currency manipulation are far lower than they are widely assumed to be and that the optimal response is either to do nothing or to boost domestic saving rates.

Some of the ideas first appeared in this blog, but not all.  Comments would be appreciated.

PS.  There’s also a shorter policy brief.