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Costs of Myanmar's multiple exchange-rate regime


  • Masahiro Hori
  • Yu Ching Wong


Myanmar's multiple exchange-rate regime creates various economic distortions. This paper describes the exchange-rate practices in Myanmar and develops a model of foreign exchange markets to estimate the welfare costs imposed by the current regime. Our analysis suggests that the equilibrium exchange rate could be around 400--500 kyat per US dollar, and trade openness measured using the equilibrium rate increases to more than 20% of gross domestic product (GDP) from less than 1% in the official statistics. The total welfare loss caused by the current regime is estimated to be in the order of 14--17% of GDP.

Suggested Citation

  • Masahiro Hori & Yu Ching Wong, 2013. "Costs of Myanmar's multiple exchange-rate regime," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 22(2), pages 209-233, March.
  • Handle: RePEc:taf:jitecd:v:22:y:2013:i:2:p:209-233 DOI: 10.1080/09638199.2011.555561

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    Cited by:

    1. Kubo, Koji, 2014. "Deposit dollarization in Myanmar," IDE Discussion Papers 473, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    2. Kubo, Koji, 2013. "Sources of fluctuations in parallel exchange rates and policy reform in Myanmar," IDE Discussion Papers 388, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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