Skip to main content
Article thumbnail
Location of Repository

The exchange rate regime in Asia: From crisis to crisis

By Ila Patnaik, Ajay Shah, Anmol Sethy and Vimal Balasubramaniam

Abstract

Prior to the Asian financial crisis, most Asian exchange rates were de facto pegged to the US Dollar. During the crisis, many economies experienced a brief period of extreme flexibility. A [`]fear of floating' gave reduced flexibility when the crisis subsided, but flexibility after the crisis was greater than that seen prior to the crisis. Contrary to the idea of a durable Bretton Woods II arrangement, Asia then went on to slowly raise flexibility and reduce the role for the US dollar. When the period from April 2008 to December 2009 is compared against periods of high inflexibility, from January 1991 to November 1991 and October 1995 to March 1997, the increase in flexibility is economically and statistically significant. This paper proposes a new measure of dollar pegging, the "Bretton Woods II Score". We find that Asia has been slowly moving away from a Bretton Woods II arrangement.Exchange rate regime Asia Bretton Woods II hypothesis

OAI identifier:
Download PDF:
Sorry, we are unable to provide the full text but you may find it at the following location(s):
  • http://www.sciencedirect.com/s... (external link)
  • Suggested articles


    To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.