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Title: |
Is the Korean Currency Won Strong or Weak? |
| Author: |
Kwack, Sung
Yeung; Lee, Young Sun |
| Author
Affiliation: |
Howard U;
Yonsei U |
| Source: |
International Economic Journal, Summer 1991, v. 5, no. 2, pp. 87-105 |
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Publication Date: |
Summer 1991 |
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Abstract: |
The purpose of this paper is to
quantitatively examine whether the Korean won is overvalued. The actual
and expected exchange rates seem to follow the purchasing power parity
rule. Given the foreign economic outlook including the yen- dollar and
DM-dollar rates, the simulations of a monthly model of Korea's current
account show that the changes expected in the exchange rate in 1990 and
1991 lead to a large deficit in the current account. Using the balance
in the current account as the guide for the assessment of the won, the
won is claimed to be strong. |
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