Is Time Ripe for a Currency Union in Emerging East Asia?: The Role of Monetary Stabilization

Marcelo Sánchez ()
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Marcelo Sánchez: European Central Bank, Postal: European Central Bank. Kaiserstr. 29. D-60311. Frankfurt am Main. Germany.,

Journal of Economic Integration, 2006, vol. 21, 736-763

Abstract:

This paper assesses the prospects for monetary integration between Emerging East Asian (EEA) economies. We develop a simple analytical framework for currency unions of small open economies. The empirical analysis looks at a number of supply-side characteristics of EEA countries highlighted by the model, distinguishing between aggregate and tradable sector structural features. Moreover, we discuss the evidence on the cross-country correlation of disturbances hitting the region. Our study indicates that, at present, EEA economies exhibit a high degree of cross-country supply diversity, while there is no compelling evidence that shocks are highly correlated across the region.

Keywords: East Asia; Emerging economies; Currency union; Stabilization (search for similar items in EconPapers)
JEL-codes: E52 E58 F33 F40 (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:integr:0376

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