• ISSN: 2301-3567
    • Frequency: Quarterly (2013-2014); Monthly (Since 2015)
    • DOI: 10.18178/JOEBM
    • Editor-in-Chief: Prof. Eunjin Hwang
    • Executive Editor: Ms Jessica C. Xiao
    • Abstracting/ Indexing: DOAJ, Engineering & Technology Library,  Electronic Journals Library, Ulrich's Periodicals Directory, MESLibrary, Google Scholar, Crossref, and ProQuest.
    • E-mail: joebm@ejournal.net
JOEBM 2015 Vol.3(1): 111-114 ISSN: 2301-3567
DOI: 10.7763/JOEBM.2015.V3.164

Financial Integration and Common Currency Area in ASEAN

Behrooz Gharleghi, Najla Shafighi, and Benjamin Chan Yin Fah
Abstract—As ASEAN economies moved to closer economic integration in recent years, exchange rate arrangement become an important regional concern especially after the currency crisis of 1997-98. This paper used the Augmented Dickey-Fuller and Phillips-Perron unit root tests with Johansen-Juselius cointegration approach to find out whether there is any cointegration among ASEAN countries’ exchange rates. Data are collected from 1985 M01 to 2010 M09 and divided into two groups of pre-crisis (Jan 1985 to Dec 1996) and post-crisis (Jan 1999 to sep 2010). The result reveals that there is a unique cointegrating vector in post-crisis period only, suggesting a long-run equilibrium relationship between ASEAN exchange rates. Obtained results have important implications for developing a common currency area.

Index Terms—Cointegration, exchange rate, unit root, VECM.

Behrooz Gharleghi and Benjamin Chan Yin Fah are with the Asia Pacific University of Technology an Innovation, Bukit Jalil, 57000, Malaysia (e-mail: behrooz@apu.edu.my, benjamin@apu.edu.my).
Najla Shafighi is with the National University of Malaysia, 43600, Bangi, Malaysia (e-mail: Shafighi_nab@yahoo.com).

[PDF]

Cite: Behrooz Gharleghi, Najla Shafighi, and Benjamin Chan Yin Fah, "Financial Integration and Common Currency Area in ASEAN," Journal of Economics, Business and Management vol. 3, no. 1, pp. 111-114, 2015.

Copyright © 2008-2015. Journal of Economics, Business and Management. All rights reserved.
E-mail: joebm@ejournal.net