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Determinants of exchange rate practices: some empirical evidence from Thailand

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Author Info
Frank W. Agbola
Chartri Kunanopparat
Abstract

Although Thailand has achieved a spectacular average annual growth rate of 8% in the past two decades, due largely to the opening of the economy to international trade, there is not yet a consensus on the exchange rate regime that is most suited to the restoration of sustained growth in Thailand. This study empirically investigates the predictors of exchange rate regimes in Thailand using quarterly data spanning the period 1990:1 and 2002:3. Results indicate that the government is likely to choose a pegged exchange rate regime in periods of monetary shocks and unsustainable public finance whereas an open economy with a degree of economic development and foreign reserves will encourage the government to opt for a flexible exchange regime in Thailand.

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Article provided by Taylor and Francis Journals in its journal Applied Economics.

Volume (Year): 37 (2005)
Issue (Month): 7 (April)
Pages: 807-816
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Handle: RePEc:taf:applec:v:37:y:2005:i:7:p:807-816

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
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  5. Berger, Helge & Sturm, Jan-Egbert & Haan, Jakob de, 2000. "An Empirical Investigation into Exchange Rate Regime Choice and Exchange Rate Volatility," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  6. Flood, Robert P, 1979. "Capital Mobility and the Choice of Exchange Rate System," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 20(2), pages 405-16, June. [Downloadable!] (restricted)
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  12. von Hagen, Jürgen & Zhou, Jizhong, 2002. "The Choice of Exchange Rate Regimes: An Empirical Analysis for Transition Economies," CEPR Discussion Papers 3289, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  13. Hélène Poirson, . "How Do Countries Choose Their Exchange Rate Regime?," IMF Working Papers 01/46, International Monetary Fund. [Downloadable!]
  14. Holden, Paul & Holden, Merle & Suss, Esther C, 1979. "The Determinants of Exchange Rate Flexibility: An Empirical Investigation," The Review of Economics and Statistics, MIT Press, vol. 61(3), pages 327-33, August. [Downloadable!] (restricted)
  15. Poole, William, 1970. "Optimal Choice of Monetary Policy Instruments in a Simple Stochastic Macro Model," The Quarterly Journal of Economics, MIT Press, vol. 84(2), pages 197-216, May. [Downloadable!] (restricted)
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  16. Eichengreen, Barry, 2001. "What problems can dollarization solve?," Journal of Policy Modeling, Elsevier, vol. 23(3), pages 267-277, April. [Downloadable!] (restricted)
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  1. Menkhoff, Lukas & Chodechai Suwanaporn, Chodechai, 2005. "On the Rationale of Bank Lending in Pre-Crisis Thailand," Diskussionspapiere der Wirtschaftswissenschaftlichen Fakultät der Universität Hannover dp-326, Universität Hannover, Wirtschaftswissenschaftliche Fakultät. [Downloadable!]
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  2. Liew, Venus Khim-Sen & Baharumshah, Ahmad Zubaidi & Puah, Chin-Hong, 2009. "Monetary Model of Exchange Rate for Thailand: Long-run Relationship and Monetary Restrictions," MPRA Paper 17715, University Library of Munich, Germany. [Downloadable!]
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