Article ID Journal Published Year Pages File Type
963724 Journal of International Money and Finance 2006 18 Pages PDF
Abstract
This paper investigates the degree and the evolution of business cycle synchronization between Hong Kong SAR and Mainland China, as well as Hong Kong SAR and the United States with a two-step procedure. A structural VAR model is first set up to capture the dynamics of shocks to different regions. Then a state-space model is used to gauge the degree of symmetry of regional shocks, and to examine whether business cycles have been more synchronized over time. Our results cast doubt on the feasibility of a currency union between Hong Kong and Mainland China in the foreseeable future.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
Authors
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