Is China an Optimum Currency Area?
AbstractThis paper analyzes regional differences across Chinese regions, employing an optimum currency area framework. Empirically, we consider the cross-sectional correlation measure of Solnik & Roulet (2000) when examining data on GDP, trade, inflation and regional budget between 1991 and 2001. Our preliminary results suggest that China probably is more of an optimum currency area than first expected. It is debatable, though, whether Hong Kong and Macao are appropriate as candidates. The results also indicate that there might be other constellations of regions that could be closer to an optimum currency area than the current Yuan area.
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Bibliographic InfoPaper provided by Lund University, Department of Economics in its series Working Papers with number 2005:6.
Length: 34 pages
Date of creation: 25 Jan 2005
Date of revision:
Publication status: Published in Journal of Asian Economics, 2005, pages 612-634.
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Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/
More information through EDIRC
China; optimum currency area; regional developments; cross-sectional correlation;
Other versions of this item:
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- O53 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-02-01 (All new papers)
- NEP-MON-2005-02-01 (Monetary Economics)
- NEP-SEA-2005-02-01 (South East Asia)
- NEP-TRA-2005-02-01 (Transition Economics)
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