Fugitive or Orphan? The Shanghai Yen in the Early Days of the Sino-Japanese War, 1938-1939

Shinji Takagi

No 2026-04, AGI Working Paper Series from Asian Growth Research Institute

Abstract: We explore a phenomenon observed during the Second Sino-Japanese War in which the value of the Japanese yen in Shanghai fell below the official rate. Shanghai provided a parallel market in which yen could be traded indirectly against British pounds through the intermediation of the Chinese yuan. The implied yen-pound rate was broadly approximated by purchasing power parity (PPP) before a significant divergence from PPP emerged in favour of the pound. This likely reflected negative news that signalled, among other things, a prospective withdrawal of Japanese yen as occupation money, which meant that the parallel market would close.

Keywords: China during the Second Sino-Japanese War; parallel foreign exchange market; occupation currency; Japanese occupation currency in China; Sino-Japanese War (search for similar items in EconPapers)
JEL-codes: E42 F31 F33 N25 (search for similar items in EconPapers)
Date: 2026-02
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://agi.repo.nii.ac.jp/records/2000262 (text/html)
https://agi.repo.nii.ac.jp/record/2000262/files/WP2026-04.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:agi:wpaper:02000262

Access Statistics for this paper

More papers in AGI Working Paper Series from Asian Growth Research Institute Contact information at EDIRC.
Bibliographic data for series maintained by ().