The new classical theory of inflation implies that the choice between financing a given path of public spending through debt or tax (seigniorage) finance has no substantial effect on inflation. This paper tests this hypothesis for Korea by estimating a reduced-form relation between inflation,...

A common argument for pegging the exchange rate is that it enforces discipline on domestic monetary policy, thus stabilizing inflation expectations. This paper argues that this reasoning does not necessarily apply to East Asia, as the nominal exchange rate pegging policies of these economies are...

New regional initiatives abound, both outside Asia and within. Free Trade Areas in the West - notably NAFTA, its possible enlargement into an FTA of the Americas, and the European Union - have implications for Asia. Asian manufacturers will experience trade diversion, especially in textiles and...

According to classical Ricardian trade theory, overall productivity differences between countries are manifested as differences in real labor incomes (absolute advantage), while the sectoral pattern of productivity differences determines trade patterns (comparative advantage). This paper...