Penerapan Kriteria Optimum Currency Area dan Volatilitasnya: Studi Kasus Asean-5 +3

Dimas Bagus Wiranata Kusuma () and Arief Dwi Putranto ()
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Dimas Bagus Wiranata Kusuma: University Malaysia
Arief Dwi Putranto: University Malaysia

Bulletin of Monetary Economics and Banking, 2010, vol. 13, issue 2, 187-214

Abstract: This paper is aiming to elaborate the case of how exchange rate volatility (ERV), which is supposedly considered to form optimum currency area (OCA), can be reduced in order justify the feasibility of the OCA idea within ASEAN5 plus three. Interestingly, the results provide some evidences that the ASEAN5+3 are considered not really ready to form OCA. It corroborates the existing opinion that the different in economic structure and its policies over foreign environment are becoming some barriers and challenging area to synchronize in the following time. The positive impacts AS to ERV which are incurred in ASEAN5+3 economies indicate the existence of inappropriate condition to form OCA since there are no similar shocks across a monetary union»s participating countries. Under such condition, it would foster the costs of forgoing the exchange rate as a shock absorbing mechanism. It deserves to argue that those observed countries still are resisting their existing regime since they are till believing that they begin to establish the system of monetary which are able to absorb any possible shocks in regards of their SIZE. In sum, the ASEAN5+3 countries are considered to fulfilling the requirement to form currency optimum area which are able to main their stable currency.

Keywords: Optimum Currency Area; a Single Currency; Exchange Rate Volatility; Stability Journal: Bulletin of Monetary Economics and Banking (search for similar items in EconPapers)
JEL-codes: D81 E52 F15 F36 (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:13:y:2010:i:2c:p:187-214

DOI: 10.21098/bemp.v13i2.260

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