Exchange rate reform and its inflationary consequences: an empirical analysis for China


Lu, M. and Zhang, Z. (1998) Exchange rate reform and its inflationary consequences: an empirical analysis for China. Southampton, UK, University of Southampton (Discussion Papers in Economics and Econometrics, 9808).

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Description/Abstract

In examining China's exchange rate policy in the reforming years, the paper finds empirical evidence of its long-run inflationary consequences, but the effects appear to be not sizable. In the short-run, while changes in the devaluation rate are positively correlated with the increase in the growth rate of inflation, the inflation inertia is also modest. the moderate inflationary cost of devaluation provides some explanation of the smooth transition of exchange rate policy regime in China and the authorities' ability to put more weight on external competitiveness.

Item Type: Monograph (Discussion Paper)
Related URLs:
Subjects: H Social Sciences > HB Economic Theory
J Political Science > JQ Political institutions Asia
Divisions: University Structure - Pre August 2011 > School of Social Sciences > Economics
ePrint ID: 32995
Date Deposited: 05 Feb 2008
Last Modified: 27 Mar 2014 18:20
URI: http://eprints.soton.ac.uk/id/eprint/32995

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