Time-varying estimates on the openness of the capital account in Korea and Taiwan
AbstractHow open are the capital accounts in Korea and Taiwan? Has there been a trend towards more financial openness during the 1980s? This paper aims at answering both questions by estimating a model of interest determination first outlined by Edwards and Khan, in an extension suggested by Haque and Montiel. Use is made of a time-varying parameter estimation based on the Kalman filter technique, instead of the usual constant parameter estimation. The findings indicate a low degree of capital mobility for both Korea and Taiwan, and no trend towards more financial openness (except recently in Taiwan's interbank market). The dismantling of capital controls and of internal financial restrictions is thus likely to impose an important loss of monetary autonomy in both countries ... Quel est le degrÃ© d'ouverture des comptes de capital en CorÃ©e et Ã Taiwan ? Une tendance vers une plus grande ouverture financiÃ¨re s'est-elle manifestÃ©e au cours des annÃ©es 80 ? Le but de ce document est de rÃ©pondre Ã ces deux questions en procÃ©dant Ã l'estimation d'un modÃ¨le de dÃ©termination des taux d'intÃ©ret, d'abord esquissÃ© par Edwards et Khan, puis approfondi par Haque et Montiel. On utilise l'estimation d'un paramÃ¨tre variant avec le temps et basÃ©e sur la technique du filtre de Kalman au lieu de l'estimation habituelle d'un paramÃ¨tre constant. Les rÃ©sultats indiquent un faible degrÃ© de mobilitÃ© des capitaux, Ã la fois pour la CorÃ©e et Taiwan et aucune tendance vers une plus grande ouverture financiÃ¨re (sauf rÃ©cemment Ã Taiwan dans le marchÃ© inter-bancaire). Le dÃ©mantÃ¨lement du systÃ¨me de contrÃ´le des capitaux et des restrictions financiÃ¨res internes va donc provoquer une diminution sensible de l'autonomie monÃ©taire dans ces deux pays ...
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Development Economics.
Volume (Year): 41 (1993)
Issue (Month): 2 (August)
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Web page: http://www.elsevier.com/locate/devec
Other versions of this item:
- Helmut Reisen & Hélène Yèches, 1991. "Time-Varying Estimates on the Openness of the Capital Account in Korea and Taiwan," OECD Development Centre Working Papers 42, OECD Publishing.
- E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
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