Asian Studies Commons^™

Monetary Policy Cooperation To Support Asian Economic Integration, Hwee Kwan Chow, Peter Nicholas Kriz, Roberto S. Mariano, Augustine H. H. Tan

Research Collection School Of Economics

This paper considers the form of monetary policy coordination and regional exchange rate arrangement that would best support economic and financial integration in East Asia. In view of the region's economic diversity, we propose a graduated program of informal policy cooperation from weak forms of cooperation to more intensive modes of cooperation such as the adoption of common monetary policy objectives. An array of informal monetary arrangements rooted to the degree of institutional development can improve the effectiveness of both sovereign and regional institutions, and promote integration in East Asia. Drawing upon the European experience with the Exchange Rate Mechanism …