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| Sin, Lew Yuen; Asam Tuan Lorik, Ku. |
| Intra-trade among ASEAN countries have remained around 20% over the period 1993 until 2001 (ASEAN Secretariat). With this significant amount of trade being conducted between members of ASEAN countries, businesses were faced with exchange rate exposure due to the volatility of the exchange rate within the regions as was experienced during the Asian Financial Crisis of 1997-98. Members of the European Union overcome this exchange rate exposure by agreeing to form a monetary union and adopting Euro as their common currency in 1999. This paper examines the feasibility of a Optimum Currency Area (OCA) for ASEAN 9 to adopt a common currency, especially after the 1997-98 Asian Financial Crisis. Using macro-economic data for 9 ASEAN countries over the 15 years... |
| Tipo: Journal Article |
Palavras-chave: Monetary union; Optimum currency area; SVAR; Financial Economics; E52; F31; F36. |
| Ano: 2006 |
URL: http://purl.umn.edu/50151 |
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| Yelten, E. Sibel. |
| This paper analyzes the ad hoc decision of three Asian countries to peg their currency to the U.S. dollar prior to the Asian crisis. It uses the Sjaastad model to estimate the optimal basket weights for Thailand, Korea, and Singapore. The analysis in this paper differs from the optimal basket research since we are not searching for an ad hoc optimal basket; rather, the basket is the solution to the problem. For Thailand and Korea, the correct weights of the dollar in the basket are estimated to be 44 and 65 percent, respectively, which differ significantly from the actual weight of 100 percent for the U.S. dollar in their currency basket prior to the 1997 Asian crisis. Singapore, with a weight of 85 percent for the U.S. currency, is closer to a dollar peg,... |
| Tipo: Journal Article |
Palavras-chave: Optimum currency area; Asian crisis; Exchange rate basket; Currency peg; Financial Economics; E32; F31. |
| Ano: 2003 |
URL: http://purl.umn.edu/43998 |
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