| By: |
Chang-Jin Kim (KIEP - Korea Institute for International Economic Policy);
Jong-Wha Lee |
| Abstract: |
This paper examines whether changes in exchange rate arrangements have
affected monetary independence in East Asian countries after the 1997 Asian
crisis. We find that the sensitivity of local to U.S. interest rates has
declined for many Asian countries since they adopted floating exchange rate
regimes after the crisis. This empirical finding suggests that the choice of
exchange rate regime is an important factor for the independence of monetary
policy. Floating regimes appear to offer East Asian countries at least some
degree of monetary independence after the East Asian crisis. |
| Keywords: |
exchange rate regime, monetary independence, East-Asia |
| JEL: |
F31 O24 O23 |
| Date: |
2011–12 |
| URL: |
http://d.repec.org/n?u=RePEc:eab:financ:21765&r=ifn |