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Title: |
Exchange Rate Arrangements among Sticky and Flexible Price Countries:
Implications for Some Asia-Pacific Economies |
| Author: |
Chan, Kenneth
S. |
| Author
Affiliation: |
McMaster U |
| Source: |
International Economic Journal, Spring 1996, v. 10, no. 1, pp. 21-31 |
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Publication Date: |
Spring 1996 |
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Abstract: |
The present paper examines a two-country
model, one with flexible wage and prices (which seems to characterize
most high performance East Asian economies) and the other with sticky
wage and prices. Wage and prices often "overshoot" in the flexible wage
economy . The impacts of fixed and floating exchange rate regime on the
flexible wage economy is typically different. A fixed (floating)
exchange rate regime is superior for financial (real or technological)
shocks. |
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