Currency substitution and speculative attacks on a currency board system
Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 62_Review of books or of software (or similar publications/items) › peer-review
Author(s)
Detail(s)
| Original language | English |
|---|---|
| Pages (from-to) | 53-78 |
| Journal / Publication | Journal of International Money and Finance |
| Volume | 21 |
| Issue number | 1 |
| Publication status | Published - Feb 2002 |
| Externally published | Yes |
Link(s)
Abstract
A currency board arrangement (CBA) is supposed to be robust against attacks. Currency substitution complicates life, with controversial implications for floating versus fixed exchange rate regimes. After reporting evidence of currency substitution in Hong Kong, a monetary model incorporating currency substitution is used to estimate the shadow exchange rate and the probability of speculative attack on the Hong Kong dollar. A decomposition analysis of a Markov-switching model indicates that the no-attack regime was the most durable one. This implies that Hong Kong's quasi CBA was relatively robust against both speculative attacks and currency substitution. © 2002 Elsevier Science Ltd. All rights reserved.
Research Area(s)
- Currency board, Currency substitution, Hong Kong, Markov-switching model, Speculative attack
Citation Format(s)
Currency substitution and speculative attacks on a currency board system. / Tsang, Shu-Ki; Ma, Yue.
In: Journal of International Money and Finance, Vol. 21, No. 1, 02.2002, p. 53-78.
In: Journal of International Money and Finance, Vol. 21, No. 1, 02.2002, p. 53-78.
Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 62_Review of books or of software (or similar publications/items) › peer-review
