Is a Change in the Renminbi Exchange Rate in China's Interest?

Barry Eichengreen

Asian Economic Papers, 2005, vol. 4, issue 1, 40-75

Abstract: This paper reviews the controversy over China's exchange rate regime. Placing the issue in the context of the literature on exit strategies, it argues that the best time for China to exit from its peg is now while capital is flowing in and there is a tendency for the rate to appreciate. In contrast, waiting to exit until sentiment has turned around would be problematic. In addition, moving now to a managed float would help the Chinese authorities to gain better control of domestic credit conditions. The principal objections to this recommendation (viz., the banking system is weak, many state enterprises are loss making, and the capital account is not sufficiently open) are unconvincing. Finally, the impact on other countries is likely to be more complex and varied than suggested by other analyses.

Date: 2005
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.mitpressjournals.org/doi/abs/10.1162/asep.2005.4.1.40 link to full text (text/html)
Access to full text is restricted to subscribers.

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:tpr:asiaec:v:4:y:2005:i:1:p:40-75

Ordering information: This journal article can be ordered from
https://mitpressjour ... rnal/?issn=1535-3516

Access Statistics for this article

Asian Economic Papers is currently edited by Wing Thye Woo, Sungbae An, Fukunari Kimura and Ming Lu

More articles in Asian Economic Papers from MIT Press
Bibliographic data for series maintained by The MIT Press ().