Yen Bloc or Yuan Bloc: An Analysis of Currency Arrangements in East Asia

34 Pages Posted: 11 Mar 2009

See all articles by Kazuko Shirono

Kazuko Shirono

International Monetary Fund (IMF)

Date Written: Janurary 2009

Abstract

This paper examines the role of Japan against that of China in the exchange rate regime in East Asia in light of growing interest in forming a currency union in the region. The analysis suggests that currency unions with China tend to generate higher average welfare gains for East Asian countries than currency unions with Japan or the United States. Overall, Japan does not appear to be a dominant player in forming a currency union in East Asia, and this trend is likely to continue if China's relative presence continues to rise in the regional trade.

Keywords: Exchange rate regimes, East Asia, Japan, China, People's Republic of, Currencies, Monetary unions, Trade, Economic cooperation, Economic models, Trade models, Data analysis

Suggested Citation

Shirono, Kazuko, Yen Bloc or Yuan Bloc: An Analysis of Currency Arrangements in East Asia (Janurary 2009). IMF Working Paper No. 09/3, Available at SSRN: https://ssrn.com/abstract=1356458

Kazuko Shirono (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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