کد مقاله | کد نشریه | سال انتشار | مقاله انگلیسی | نسخه تمام متن |
---|---|---|---|---|
5048073 | 1370938 | 2008 | 14 صفحه PDF | دانلود رایگان |
![عکس صفحه اول مقاله: A role model for China? Exchange rate flexibility and monetary policy in Japan A role model for China? Exchange rate flexibility and monetary policy in Japan](/preview/png/5048073.png)
A substantial number of papers have proposed to allow for more exchange rate flexibility of the Chinese yuan. But few papers have tried to project how Chinese monetary policy will behave under flexible exchange rates. As Japan provides an important role model for China, this paper studies the role of the yen/dollar exchange rate for Japanese monetary policy after the shift of Japan from a fixed to a floating exchange rate regime. In contrast to prior studies, we allow for regime shifts in the impact of the exchange rate on monetary policy. The results show that the exchange rate had a substantial impact on Japanese monetary policy in periods of appreciation. This implies that repeated attempts to soften the appreciation pressure by interest rate cuts have led Japan into the liquidity trap. The economic policy conclusion for China is to keep the exchange rate pegged (to the dollar).
Journal: China Economic Review - Volume 19, Issue 2, June 2008, Pages 183-196