Can a common currency induce intra-regional trade? The southeast asian perspective
Recent literature strongly suggests that a common currency could be a potential long-term currency arrangement for Association of Southeast Asian Nations (ASEAN). However, a high level of macroeconomic heterogeneity among these countries raises questions about the viability of managing a common mone...
| Main Authors: | , |
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| Format: | Journal Article |
| Published: |
2016
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| Online Access: | http://hdl.handle.net/20.500.11937/25528 |
| _version_ | 1848751734432727040 |
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| author | Kabir, S. Salim, Ruhul |
| author_facet | Kabir, S. Salim, Ruhul |
| author_sort | Kabir, S. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | Recent literature strongly suggests that a common currency could be a potential long-term currency arrangement for Association of Southeast Asian Nations (ASEAN). However, a high level of macroeconomic heterogeneity among these countries raises questions about the viability of managing a common monetary policy in the long run. In response to such currency management policy debate, this study analyzes the intra-regional trade induction capability of a common currency for the ASEAN region. Using a gravity model of trade and an extended event study approach, the study finds that a common currency would induce intra-ASEAN trade by 11-14 cents against every dollar of ASEAN gross domestic product. However, if the cost of managing regional macroeconomic harmonization is substantially high, a currency union for the ASEAN economy not be cost effective. |
| first_indexed | 2025-11-14T07:57:26Z |
| format | Journal Article |
| id | curtin-20.500.11937-25528 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T07:57:26Z |
| publishDate | 2016 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-255282017-09-13T15:16:37Z Can a common currency induce intra-regional trade? The southeast asian perspective Kabir, S. Salim, Ruhul Recent literature strongly suggests that a common currency could be a potential long-term currency arrangement for Association of Southeast Asian Nations (ASEAN). However, a high level of macroeconomic heterogeneity among these countries raises questions about the viability of managing a common monetary policy in the long run. In response to such currency management policy debate, this study analyzes the intra-regional trade induction capability of a common currency for the ASEAN region. Using a gravity model of trade and an extended event study approach, the study finds that a common currency would induce intra-ASEAN trade by 11-14 cents against every dollar of ASEAN gross domestic product. However, if the cost of managing regional macroeconomic harmonization is substantially high, a currency union for the ASEAN economy not be cost effective. 2016 Journal Article http://hdl.handle.net/20.500.11937/25528 10.1111/rurd.12054 restricted |
| spellingShingle | Kabir, S. Salim, Ruhul Can a common currency induce intra-regional trade? The southeast asian perspective |
| title | Can a common currency induce intra-regional trade? The southeast asian perspective |
| title_full | Can a common currency induce intra-regional trade? The southeast asian perspective |
| title_fullStr | Can a common currency induce intra-regional trade? The southeast asian perspective |
| title_full_unstemmed | Can a common currency induce intra-regional trade? The southeast asian perspective |
| title_short | Can a common currency induce intra-regional trade? The southeast asian perspective |
| title_sort | can a common currency induce intra-regional trade? the southeast asian perspective |
| url | http://hdl.handle.net/20.500.11937/25528 |