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Impacts of Quantitative Monetary Easing Policy in the United States and Japan on the Thai Economy


  • Bhanupong Nidhiprabha


type="main"> This paper compares and contrasts the impact of quantitative easing (QE) monetary policy conducted by the Federal Reserve Bank and the Bank of Japan on the Thai economy. The impact of the first round of QE policy is related to Thailand's export market exposures, trade, and financial linkages with the United States and Japan. In the short run, QE has either an expansionary or contractionary effect on Thailand's output depending on whether the baht depreciates or appreciates against the US dollar and the Japanese yen. In the long run, when QE stimulates world output expansion, Thailand's manufactured output and exports respond positively to world economic recovery. In the medium run, the impact of QE is related to the appreciation of the Chinese yuan and the slowing of the Chinese economy, which further depresses Thailand's exports and prolongs Thailand's output recovery.

Suggested Citation

  • Bhanupong Nidhiprabha, 2016. "Impacts of Quantitative Monetary Easing Policy in the United States and Japan on the Thai Economy," The Developing Economies, Institute of Developing Economies, vol. 54(1), pages 80-102, March.
  • Handle: RePEc:bla:deveco:v:54:y:2016:i:1:p:80-102

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    References listed on IDEAS

    1. Nat Tharnpanich & John McCombie, 2013. "Balance-of-payments constrained growth, structural change, and the Thai economy," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 35(4), pages 569-598.
    2. Francis Breedon & Jagjit S Chadha & Alex Waters, 2012. "The financial market impact of UK quantitative easing," BIS Papers chapters,in: Bank for International Settlements (ed.), Threat of fiscal dominance?, volume 65, pages 277-304 Bank for International Settlements.
    3. Hess Chung & Jean‐Philippe Laforte & David Reifschneider & John C. Williams, 2012. "Have We Underestimated the Likelihood and Severity of Zero Lower Bound Events?," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 44, pages 47-82, February.
    4. Kano, Takashi & Morita, Hiroshi, 2015. "An equilibrium foundation of the Soros chart," Journal of the Japanese and International Economies, Elsevier, vol. 37(C), pages 21-42.
    5. Fukuda, Shin-ichi, 2015. "Abenomics: Why was it so successful in changing market expectations?," Journal of the Japanese and International Economies, Elsevier, vol. 37(C), pages 1-20.
    6. Yutaka Harada & Minoru Masujima, 2009. "Effectiveness and Transmission Mechanisms of Japan's Quantitative Monetary Easing Policy," Japanese Economy, Taylor & Francis Journals, vol. 36(1), pages 48-105.
    7. Michael T. Kiley, 2014. "The Response of Equity Prices to Movements in Long‐Term Interest Rates Associated with Monetary Policy Statements: Before and After the Zero Lower Bound," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 46(5), pages 1057-1071, August.
    8. repec:tpr:asiaec:v:14:y:2015:i:3:p:110-125 is not listed on IDEAS
    9. Menon, Jayant & Ng, Thiam Hee, 2013. "Impact of Eurozone Financial Shocks on Southeast Asian Economies," Working Papers on Regional Economic Integration 116, Asian Development Bank.
    10. Peter Sinclair & Colin Ellis, 2012. "Quantitative easing is not as unconventional as it seems," Oxford Review of Economic Policy, Oxford University Press, vol. 28(4), pages 837-854, WINTER.
    11. George Kapetanios & Haroon Mumtaz & Ibrahim Stevens & Konstantinos Theodoridis, 2012. "Assessing the Economy‐wide Effects of Quantitative Easing," Economic Journal, Royal Economic Society, vol. 122(564), pages 316-347, November.
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