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Potential Currency Areas in East Asia using United States, Japan or China as the Monetary Anchor
No full textThis paper applies fuzzy clustering techniques to developed and emerg- ing economies in East Asia, in order to arrive at an identification of potential subgroups of economies for monetary union. The statistical criteria employed is the one suggested by the Optimal Currency Areas theory, and the period exam- ined includes the recent global crisis. Three alternative monetary anchor coun- tries are proposed, namely the United States, Japan and China, and hence, to an extent, the analysis does indicate the relative importance of the three worlds larg- est economies to East Asia. Due to the endogeneity of the convergence criteria in the eurozone, founding member states of emu are used as a point of reference for East Asia to indicate the level of preparedness for monetary union in this region. Findings indicate that Singapore and Hong Kong are relatively prepared for inte- gration. In addition, results do also signify the dominance of Japan despite the prevalence of the dollar standard in the region
Exchange Rate Fixation between US, China, Japan and Eurozone
No full text This article assesses the feasibility of exchange rate fixation among the largest economies today, namely, the US, Japan, China and Germany/Eurozone, by reviewing variables according to the optimum currency areas framework. The hypothesis is that with greater interconnectedness in general through time there should be greater convergence in the monetary integration dimensions. The period examined spans from 1980 to 2012, an over-30-year period, encompassing the recent episode of global contraction. While the findings are mixed, economically they seem to suggest a general trend towards greater compatibility or at least one which is not in serious contradiction to exchange rate fixity, particularly for the US and Eurozone. JEL Classification: E62, F31, F32, F41, F42, O53 </jats:p
Revisiting business cycles in the Eurozone: A fuzzy clustering and discriminant approach
No full textEl dólar chino vinculado al de Hong Kong durante la crisis global
No full textThis paper explores the domestic price level and trade competitiveness of Hong Kong in addition to the compatibility of this dollar-based currency board to the criteria inspired by the optimum currency area (OCA) theory. On price and competitiveness, findings point out that during the turmoil Hong Kong had not performed as well as that in the past and an apparent reason for this is the inflows of hot capital from abroad especially of the US that fuelled rising property prices. On conformity to the OCA criteria, the findings broadly corroborate the fixed exchange regime with the US as the monetary anchor country but at the same time China appears as a prospective contender to US as the monetary anchor. In the longer run, amidst the prolonged economic and monetary weaknesses in the US plus the emergence of renminbi as a global currency, Hong Kong might as well unify its exchange rate with the Chinese money.Este documento explora el nivel de precios internos y la competitividad comercial de Hong Kong, además de la compatibilidad de esta caja de conversión basada en el dólar con los criterios inspirados en la teoría de la zona monetaria óptima (ZMO). En cuanto al precio y la competitividad, los hallazgos señalan que durante la agitación Hong Kong no se había desempeñado tan bien como en el pasado y una razón aparente de esto son las entradas de capital proveniente del extranjero, especialmente de los Estados Unidos, que impulsaron el alza de los precios de las propiedades. En conformidad con los criterios de la ZMO, los hallazgos corroboran ampliamente el régimen de cambio fijo con los Estados Unidos como ancla monetaria, pero, al mismo tiempo, China aparece como un posible candidato a contendor de Estados Unidos como ancla monetaria. A más largo plazo, en medio de la prolongada debilidad económica y monetaria en los Estados unidos, más el surgimiento del renminbi como moneda global, Hong Kong podría también unificar su tipo de cambio con el dinero chino
The Feasibility Of East Asian Monetary Union As An Optimum Currency Area
Get PDFMonetary cooperation in East Asia has become increasingly important and
practical, particularly in times of regional economic and financial crisis.
Contrary to those papers of studies in the mainstream, this paper evaluates the
feasibility of monetary union in East Asia by benchmarking its optimum currency
area (OCA) criteria against selected dollarised countries and the European
Economic and Monetary Union (EMU). Four criteria are proposed. The US
dollar is designated as the anchor currency. To some extent, results do confirm
the validity of the criteria and suggest a considerably strong case for monetary
integration in parts of the region
Germany versus the United States: Monetary Dominance in the Eurozone
Get PDFThis study inspects if there is greater convergence with Germany amongst the Eurozone founding members and if their relations with the hegemonic economy have been more symmetrical after “euroization”. The dimensions explored are those inspired by the optimum currency areas (OCA) framework. To some extent, the findings could signify if real convergence has been significantly endogenous. At the same time, to assess the relative dominance of Germany, the features against Germany are compared to those against US. In addition, the paper also appraises some aspects of economic performance to check whether economic conditions across the states have improved and converged after unification. In some convergence aspects, findings suggest remarkable convergence with Germany and across the states but also relative convergence with US. On economic performance, results indicate substantial improvements in inflation and unemployment. Amongst the founding states, Ireland has idiosyncratically shown serious divergences in a number of the convergence and performance measures
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