Balance of Payments of East Asian Countries: Impact of the Coordinated Monetary Policy

Yana Valeryevna Dyomina ()
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Yana Valeryevna Dyomina: Economic Research Institute FEB RAS

Spatial Economics=Prostranstvennaya Ekonomika, 2014, issue 1, 138-152

Abstract: The paper examines the equilibrium state of balance of payments of East Asian countries by means of the monetary policy instruments. For this purpose the author determines the value of the equilibrium exchange rate of AMU (Asian Monetary Unit) against the U.S. dollar. The equilibrium exchange rate is the one that smoothes values of net merchandise exports and net capital exports. The author employs panel data regression analysis (using statistics of trade and capital (foreign direct investment) flows between East Asian countries and the United States) to obtain quantitative estimation of trade and investment effects of the coordinated monetary policy. The paper shows that transition of East Asian region (China, Japan, Republic of Korea, Indonesia, Malaysia, Vietnam, the Philippines and Thailand) to the single currency (AMU) will have a negative effect on the balance of payments of the studied countries: this will increase the mismatch between commodity and capital flows.

Keywords: ?; balance; of; payments; ?; equilibrium; exchange; rate; ?; monetary; integration; ?; AMU; ?; Mundell-; Fleming; concept; ?; ASEAN+3; ?; East; Asia (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:far:spaeco:y:2014:i:1:p:138-152

DOI: 10.14530/se.2014.1.138-152

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