Exchange rate regimes in the Asia-Pacific region: An empirical analysis

The appropriate choice exchange rate regime for the Asia-Pacific area has been heatedly debated since the Asian financial crisis in 1997-98. Many researchers argue that the de facto exchange rate regimes of the four crisis-hit countries---Malaysia, Thailand, Indonesia and the Philippines in this area have not departed significantly from the soft dollar-peg regimes of the pre-crisis period. This thesis uses a three-stage-least-squares (3-SLS) methodology to estimate the de facto exchange rate regimes of four crisis-hit countries in the pre- (January 1993 to June 1997) and post-crisis (October 1998 to January 2008) periods. The results show that during the post-crisis period the Malaysian Ringgit was pegged to the U.S. dollar, and the Thai Baht and the Indonesian Rupiah were managed floats. For the Philippine Peso, the results are not conclusive about whether the post-crisis regime was closer to a fixed or a floating regime.