Asymmetry of Shocks and Convergence in Selected Asean Countries: A Dynamic Analysis

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Asymmetry of Shocks and Convergence in Selected Asean Countries: A Dynamic Analysis

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dc.contributor.author Cortinhas, Carlos en_GB
dc.contributor.department Economic Policy Research Unit (NIPE), Universidade do Minho en_GB
dc.contributor.department University of Exeter en_GB
dc.date.accessioned 2008-09-12T10:36:50Z en_GB
dc.date.accessioned 2011-01-25T10:25:48Z en_US
dc.date.accessioned 2013-03-19T15:57:12Z
dc.date.issued 2006 en_GB
dc.description.abstract This paper aims to investigate whether structural shocks among ASEAN countries are becoming more symmetrical over time, thus indicating whether this region is becoming better prepared to introduce a common monetary policy. For that purpose a dynamic space-state model that complements the conventional Structural VAR models used in the existing literature was estimated by using the Kalman filter so that the evolution of the degree of shock symmetry and, therefore, the evolution in the degree of convergence could be identified over time, distinguishing between a country’s convergence with a regional partner and a more general trend of convergence with the rest of the world. The results showed that in the majority of cases there has been an increase in the degree of convergence of demand shocks in recent years. More importantly, it also showed an increase in divergence in supply shocks for most cases since the beginning of the 90’s even when taking into account the Asian Financial Crisis. This is especially true for the periphery countries suggesting that the Philippines and Thailand are not only not converging but actually diverging from the core group. These results have important implications for the prospects of the creation of a common monetary policy in the region en_GB
dc.identifier.uri http://hdl.handle.net/10036/37692 en_GB
dc.language.iso en en_GB
dc.relation.ispartofseries University of Exeter Economics Department Discussion Paper en_GB
dc.relation.ispartofseries 06/08 en_GB
dc.relation.url http://www.sobe.ex.ac.uk/economics/papers/2006/Econ_0608.pdf en_GB
dc.subject Optimum currency areas en_GB
dc.subject Monetary integration en_GB
dc.subject Asymmetric shocks en_GB
dc.subject Convergence en_GB
dc.subject ASEAN en_GB
dc.title Asymmetry of Shocks and Convergence in Selected Asean Countries: A Dynamic Analysis en_GB
dc.type Working Paper en_GB
dc.date.available 2008-09-12T10:36:50Z en_GB
dc.date.available 2011-01-25T10:25:48Z en_US
dc.date.available 2013-03-19T15:57:12Z
dc.description Formerly at Economic Policy Research Unit (NIPE), Universidade do Minho, now at University of Exeter en_GB


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