期刊名称：International Business & Economics Research Journal
印刷版ISSN：1535-0754
电子版ISSN：2157-9393
出版年度：2011
卷号：6
期号：5
语种：English
出版社：The Clute Institute for Academic Research
摘要：This paper investigates how the thinness of foreign-exchange markets causes destabilizing speculations. Using the vector-autoregression model, it is shown that in response to one-standard-deviation shock to interest and exchange rates, the dynamic capital mobility and capital market-risk have increased in the short run. During the crisis, the Asian crisis countries responded by increasing their interest rates and devaluing their currencies to stem capital flight. However, in an environment of protracted financial-sector reform and thin foreign-exchange markets, these standard policies did not stabilize the capital inflows into these countries and this can be attributable to the very thin foreign-exchange markets of these Asian countries.
