Chinese Currency Policy

Term Paper # 99956

Asian Studies
Economics > International
Economics > National

An analysis of the aspects of China's monetary policy that have been used to indirectly influence Chinese positions in terms of international relations and foreign policy.

1,174 words () | 6 sources | MLA | 2007 United States

Paper Summary:

This paper examines how Chinese monetary policy is utilized as a foreign policy device for very specific gains in international relations and looks at how this differs from other countries' monetary policy. The paper focuses on the managed float of the Chinese currency, the Renminbi (RMB) and discusses the other aspects of China's monetary policy that have been used to indirectly influence Chinese positions in terms of international relations and foreign policy.

Table of Contents:
Introduction
Hypotheses
Policy Relevance
Articles for Review
Critical Analysis of Articles

From the Paper:

"Authors Voon and Frankel examine certain aspects of China's exchange rate and currency policies. Voon, et al, in "Does China Really Lose From RMB Revaluation? Evidence From Some Export Industries," argues that China's managed float may not be necessary to protect China's export sector. Frankel examines China's exchange rate policy and strategy from a strict economist's perspective and makes the argument that a country has the right and obligation to choose whatever currency regime it feels benefits the nation and its citizens the most. Frankel examines the exchange rate policy from the perspective of alternate strategies such as expenditure reduction as well as interest rate manipulation. The import of his article is that while China benefits from its controlled exchange rate policy, it also has an obligation to do so but should consider alternate strategies since its currency and its economy has become so important to the global economy."

Sample of Sources Used:

Wang Yong. "China in the WTO: A Chinese View." China Business Review 33.5 ([YEAR]): 42-48. MasterFILE Premier. 24 October 2006. http://search.ebscohost.com.
Voon, Jan P., Guangzhong, Li, and Jimmy Ran. "Does China really lose from RMB revaluation? Evidence from some export industries." Applied Economics 38.15 (2006): 1715-1723. Business Source Complete. 24 October 2006. http://search.ebscohost.com.
Farah, Paolo D. "Five Years of China's WTO Membership: EU and US Perspectives on China's Compliance with Transparency Commitments and the Transitional Review Mechanism." Legal Issues of Economic Integration 33.3 (2006): 263-304. Business Source Complete. 24 October 2006. http://search.ebscohost.com.
Goldstein, Morris. "Paulson's First Challenge." International Economy 20.3 (2006): 10-15. Business Source Complete. 24 October 2006. http://search.ebscohost.com.
Frankel, Jeffrey. "On the Yuan: The Choice between Adjustment under a Fixed Exchange Rate and Adjustment under a Flexible Rate." CESifo Economic Studies 52.2 (2006): 246-275. SocINDEX with Full Text. 24 October 2006. http://search.ebscohost.com.