Bulletin n. 3/2010
January 2011
CONTENTS
  • Section A) The theory and practise of the federal states and multi-level systems of government
  • Section B) Global governance and international organizations
  • Section C) Regional integration processes
  • Section D) Federalism as a political idea
    • Hsiu-Fen Hsu
    Is a Common Currency Area Feasible for East Asia? A Multivariate Structural Vector Autoregression Approach
    in Asian Economic Journal , Volume 24, Issue 4, December 2010 ,  2010 ,  391-411
    In this paper the feasibility of forming a common currency area in East Asia is investigated. A three-variable structural vector autoregression model is used to identify three types of shocks: global, regional and domestic shocks. The empirical results show that in the post-crisis period the importance of asymmetric domestic shocks has declined sharply, whereas that of symmetric global and regional shocks has increased. Furthermore, although a ‘prevalent shock’ cannot be uniquely defined, most East Asian economies respond to global and regional shocks in a symmetric way. Although the findings do not provide strong support for forming a common currency area in this region at the current stage, they suggest that most East Asian economies have become relatively symmetric in terms of economic shocks and adjustments, implying that a common currency area might become viable through deepening regional integration
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