Yen Bloc or Yuan Bloc: An Analysis of Currency Arrangements in East Asia
January 1, 2009
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Summary
This paper examines the role of Japan against that of China in the exchange rate regime in East Asia in light of growing interest in forming a currency union in the region. The analysis suggests that currency unions with China tend to generate higher average welfare gains for East Asian countries than currency unions with Japan or the United States. Overall, Japan does not appear to be a dominant player in forming a currency union in East Asia, and this trend is likely to continue if China's relative presence continues to rise in the regional trade.
Subject: Currencies, Econometric analysis, Economic integration, General equilibrium models, International trade, Monetary unions, Money, Plurilateral trade, Regional trade
Keywords: Australia and New Zealand, common currency, Currencies, currency arrangement, currency union, East Asia, General equilibrium models, Gravity Model, Japan, Monetary unions, Plurilateral trade, Regional trade, trade effect, trade share, welfare effect, WP
Pages:
34
Volume:
2009
DOI:
Issue:
003
Series:
Working Paper No. 2009/003
Stock No:
WPIEA2009003
ISBN:
9781451871500
ISSN:
1018-5941
