This book contends that the East Asian financial constitution lacks an appropriate infrastructure, resulting in inefficient allocation of high savings and an over-inflated short-term debt market. It goes on to point out that despite high savings, East Asia’s dependency on financial...

Testing the existence of unit root and|or level change is necessary in order to understand the underlying processes of time series. In many studies carried out so far, the focus was only on a single aspect of unit root and level change, therefore limiting a full assessment of the given problems....

This paper proposes a new method of measuring the degree of currency misalignment through the use of offshore forward exchange rates. Using default risk adjusted no­arbitrage conditions for forward exchange contracts, we calculate the spot exchange rates and the domestic interest rates that are...

This paper studies the causal relationship between interest rates and exchange rates in Indonesia, Korea, Malaysia and Thailand during the period bordering the 1997 Asian currency crisis to investigate the appropriateness of tight monetary policy in stabilizing exchange rates. We employ VAR...

Creating regional bond markets in East Asia has emerged as an important policy topic in discussions of how to promote regional monetary and financial cooperation to prevent future crises in the region. We evaluate the rationale and the strategies and propose a road map for developing regional...

A multivariate cusum test, along with extensions for partitioned parameters, serial correlation, and error components, is developed for panel data analysis. These techniques are then applied to a study of U.S. foreign trade in manufacturing goods examining changes in the determinants, i.e., the...