Nonlinear Adjustment of ASEAN−5 Real Exchange Rates: Symmetrical or Asymmetrical?

Khim, Venus and Sen , Liew (2004) Nonlinear Adjustment of ASEAN−5 Real Exchange Rates: Symmetrical or Asymmetrical? Economics Bulletin, Vol. 6, No. 8 pp. 1−19, 6 (8). pp. 1-19.

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Abstract

This study examines whether the nonlinear adjustment dynamic of exchange rate to the equilibrium level as documented in Liew et al. (2003, 2004) is symmetrical or asymmetrical. Following the sequential tests as proposed in Teräsvirta and Anderson (1993), this study is able to identify that the US dollar based real exchange rates of Indonesia, Philippines, Singapore and Thailand exhibit LSTAR−type nonlinearity, implying that the real exchange rates of these countries have asymmetrical responds towards appreciation and depreciation. This finding provides useful guidelines in the monitoring and stabilising of ASEAN exchange rates, in order to boost the economy of this region, which has experienced different extends of negative shocks in the past few years.

Item Type: Article
Additional Information: Universiti Malaysia Sarawak, UNIMAS
Uncontrolled Keywords: UNIMAS, ASEAN, exchange rate, Symmetrical, Asymmetrical
Subjects: A General Works > AC Collections. Series. Collected works
A General Works > AC Collections. Series. Collected works

H Social Sciences > HB Economic Theory
Divisions: Academic Faculties, Institutes and Centres > Faculty of Economics and Business
Depositing User: Karen Kornalius
Date Deposited: 15 Apr 2014 02:24
Last Modified: 13 Mar 2015 07:02
URI: http://ir.unimas.my/id/eprint/1722

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