Macroeconomic instability in Hong Kong : internal and external factors
China, Hong Kong and the world economy : Studies on globalization
This chapter examines the extent to which the dollar peg may have helped to exacerbate macroeconomic volatilities in Hong Kong, by estimating an IS-LM open economy model for Hong Kong via a structural vector auto-regressive (VAR) process (Gali, 1992; Rogers, 1999). The econometric techniques of impulse response and variance decomposition analysis are applied to the VAR model to separate the major causes of inflation and instability.
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ISBN of the source publication: 9781403987426
Ma, Y. & Ng, R. C. W. (2006). Macroeconomic instability in Hong Kong : internal and external factors. In L. S. Ho & R. Ash (Eds.), China, Hong Kong and the world economy: Studies on globalization (pp. 200-218). New York: Palgrave Macmillan.