Exchange Rate Flexibility, Financial Market Openness, and Economic Growth

被引:4
作者
Lee, Il Houng [1 ]
Kim, Kyunghun [2 ]
机构
[1] Bank Korea BOK, Monetary Policy Board, 39 Namdaemun Ro, Seoul 04531, South Korea
[2] Korea Inst Int Econ Policy KIEP, Bldg C,Sejong Natl Res Complex,370 Sicheongdaero, Sejong Si 30147, South Korea
关键词
D O I
10.1162/asep_a_00595
中图分类号
F [经济];
学科分类号
02 ;
摘要
We investigate the effect of exchange rate flexibility on economic growth. We find that exchange rate flexibility negatively affects economic growth, but this effect varies with the degree of financial market openness. Countries with high financial market openness benefit from maintaining high exchange rate flexibility, whereas the opposite is true for countries with low financial market openness. This empirical result implies that policymakers should consider the long-term growth effect when formulating exchange rate policy as it could be a useful policy option for emerging markets with limited policy independence. This is particularly relevant to policy coordination since greater exchange rate flexibility alone cannot solve the global imbalance.
引用
收藏
页码:145 / 162
页数:18
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