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This paper investigates returns-volatility for six base metals traded on London Metal Exchange. Dividing the daily sample that extends from January 2, 2007 until February 15, 2018, to three periods, the financial crisis, “stabilization” and “prosperity.” The study applies panel data with Generalized Auto-Regressive Conditional Heteroskedasticity (GARCH) models. The analysis shows high conditional variance for the first two periods. The best model is the panel model with random effects for the first period and with fixed effects for the second. For the “prosperity” period, the best model is “pooled regression.” For this period, one cannot dictate any accumulation of variances.

This paper examines the value implications of remedial actions taken by the Securities Exchange Commission (SEC) during 2011 that culminated in delisting a number of Chinese companies from United States public exchanges. To achieve that we examine the institutional characteristics and performance of Specified Purpose Acquisition Companies (SPACs) used as a financing tool and gateway to the U.S. capital markets by Chinese companies in period 2004–2011. Evidence shows that SPACs merging with companies from China are not inferior in corporate structure when compared with other SPACs. While their institutional characteristics are similar, the performance tests indicate that Chinese SPACs lose value around SEC decision dates, but in overall they outperform other SPACs listed in the U.S.

Under the current global forces, economics muddled with politics is exerting undue pressures on the BRICS countries and is challenging the sustainability of their accord. Unanticipated problems are increasingly inhibiting economic and social prosperity. This paper analyzes the current difficulties that the BRICS are facing, scrutinizes their unique individual economic and political environments, and ventures to anticipate their prospects. Our consensus is that the future prosperity of these countries depends not only on their individual political and economic environments, but also on the major global powers. Furthermore, the current inevitable interconnectivity of politics and economics provides foresight into their future role on the world stage.

For the past three decades, Eastern European countries overall, but not uniformly, have exhibited a noticeable decline in their share of the industrial production sector. At the same time, trade liberalization and integration in international production networks were intensified, bringing different levels of economic development of countries in this region. The objective of this paper is to examine the impact of the real effective exchange rate (REER) on the deindustrialization or reindustrialization process in 25 post-communist Eastern European countries. The paper employs heterogeneous panel common factor approach for the period 1995-2018 to exploit the effect of diverse levels of export complexity, stage of economic development, and intensity of participation in global value chains on REER- industrial production relationship. The results establish a heterogeneous yet significant negative relationship between REER and industrial production. Our findings indicate that higher economic complexity and participation in global value chain reduces the effect of depreciation on industry development.https://www.textfixer.com/tools/remove-line-breaks.php

Free Cash Flow (FCF) was adopted in the late 1980s as a financial tool to evaluate the firm and its individual projects. We question the procedure of calculating the FCF where a significant portion of Current Liabilities is offset against Current Assets, thereby creating the hybrid asset Net Working Capital (NWC). Borrowed from accounting methodology, that procedure distorts the FCF size, composition, volatility, and estimated value. Our empirical analysis shows that the nature and extent of those distortions can misinform the firm's stockholders, lenders and borrowers, and investors at large. We propose a revised FCF that would avoid those distortions.

This paper examines Specified Purpose Acquisition Companies (SPACs) used as a financing tool for the shipping industry in the period 2004–2013. SPACs that focused on acquisitions in the shipping industry have statistically similar characteristics to the population of SPACs that entered U.S. financial markets. Additionally, shipping companies merge into SPACs for the benefits of acquiring a public listing and receiving the SPAC's cash. The paper constructs an original SPAC Shipping Index and compares its performance with benchmark indices. Under some conditions, managers of SPACs with a focus on shipping on average exhibit a return of $154 for every $1 invested.

This paper examines how commercial banks reacted to the changes in monetary tools in mid-1994, when The Federal Reserve Bank altered its policy by implicitly targeting the Federal Funds Rate (FFR). Prior to 1994, the FFR had a lagged effect on the prime rate that charged commercial banks their best customers. However, after the move by the FED in 1994, commercial banks responded immediately by changing their prime lending rate to the Federal Funds Rate plus a three-percent spread. The result is important because it demonstrates how a more transparent monetary policy targeting can have, in fact, the desired effect.

Israel, a small country in Asia, transitioned from a labor-intensive economy to become a nation with the second largest startup ecosystem in the world. What have propelled this extraordinary growth that made the state of Israel one of the most important entrepreneurial and technology-driven economies? This paper provides some background on the Israeli economy and a detailed analysis of the main drivers for this marvel transformation. It describes the impacts of change in population due to immigration, large capital injections, and economic transition from basic production of growing citrus and polishing diamonds to current state of the art technologies.

This study documents the changes in the corporate design of modern Specified Purpose Acquisition Companies (SPACs) for the years 2003–2012. Do institutional characteristics of SPACs determine the success of their merger outcomes? The paper finds that SPACs significantly redesigned their structure in the period under observation. In addition, the probability of a merger for SPACs increases if they are able to announce the deal soon after the Initial Public Offering (IPO), if the deal focuses on China and when their IPO is underwritten by Early Bird Capital.

This paper analyzes the responses of the United States and the economies of the Economic and Monetary Union (EMU) to the financial and economic crisis of 2008–2009. The crisis illuminates the fundamental structural problems within the EMU, the European Union and the United States and the scale and scope of interconnections among the world economy. The paper focuses on the reactions of the real sector to the financial disturbances in these economies. Both comparative static and dynamic methodologies are used in order to appraise the scope and pace of adjustments in response to the global crisis.

This paper examines the controversy involving international trade by employing a simple model. It analyzes the effects of unilateral technological improvements in one entity on the welfare of that entity and its trading partners. Improvements in one country are irreversible and lead to substantial welfare effects on its trading partner. The result reveals some unpleasant free trade arithmetic. However, the results do not suggest that the trade should be curtailed. Rather, the paper advocates a critical need to allocate additional resources in order to maintain their competitive edge in an era when economies are becoming increasingly integrated.

In this paper we investigate the impact of regional trade agreements (RTAs) and bilateral investment treaties (BITs) on intra-regional foreign direct investment (FDI) across Latin American countries from 1995 to 2012. We use an augmented gravity model in which we control for cross-country heterogeneity, multilateral resistances and endogeneity of RTAs/BITs. This study empirically reveals that belonging to a well-established RTAs, such as MERCOSUR, is significantly more effective than the enforcement of BITs in fostering intra-regional FDI. We observe heterogeneous impacts within the bloc: BITs exert a positive but small effect, with an estimated increase in FDI stocks between 4-7.25%, for middle income countries such as Argentina, Brazil, Chile, Costa Rica, Mexico and Uruguay. However, we observe a non-significant effect on middle-low income countries as Bolivia, Colombia, Ecuador, Peru and Paraguay. Our results suggest that political risk and the level of institutional development in the host country act as strong determinants of BITs effectiveness. Furthermore, we find that the main determinants affecting intra-bloc FDI are factor endowments and market potential. These findings shed clarity into the current debate on the effectiveness of BITs versus RTAs as an adequate mechanism to attract foreign investment.

The volatility of an asset price measures how uncertain we are about future asset price movements. It is one of the factors affecting option price and the only input into the Black–Scholes model that cannot be directly observed. Thus, estimating volatility properly is vital. Two approaches to calculating volatility are historical and implied volatilities. Using index options listed on the Chicago Board of Options Exchange, this paper focuses on historical volatility. Since numerous methods of estimating volatility may provide different results, this paper assesses the impact of volatility estimation method on theoretical option values.

One of the few constants since the United States declared its independence is the presence of frequent financial crises with similar causes. In the nineteenth century, these panics were frequent with eight occurring over the century. However, following the Second World War there was a period of relative calm, which may have led to complacency. The Savings and Loans and the current financial crises have shown that these events remain a very real threat to economic stability.

Many are currently studying the origins of the financial crisis in an attempt to answer two seemingly simple questions: why did it happen, and can another crisis be prevented? Those two questions have proved incredibly divisive. The majority opinion of The United States Financial Crisis Inquiry Commission was submitted with two dissenting positions. Furthermore, The 2010 Economic Report of the United States President does not perfectly align with any opinion presented in that report. Few studies, however, provide proper consideration to the evolution of macroeconomic thought and lengthening of the business cycle preceding the current crisis.

The Chinese economy is in a stage of energy transition: from low efficiency solid fuels to oil, gas, and electric power, from agriculture to urbanization and industrialization, from heavy industry to lighter and high tech industry, from low motorization to rapid growth of the motor vehicle population. Experts fear that continued rapid economic growth in China will translate into a massive need to expand imports of oil, coal, and gas. We build an econometric model of the Chinese energy economy based on the energy balance. We use that model to forecast Chinese energy consumption and imports to 2020. The study suggests that China will, indeed, require rapidly growing imports of oil, coal, and gas. This growth is not so sensitive to the rate of economic growth as to increases in motorization. It can be offset, but probably only in small part, by increasing domestic energy production or by improvements in the efficiency of use, particularly in the production of electric power.

The combined economies of Brazil, Russia, India and China (BRICs) appear likely to become the largest global economic group by the middle of this century. Our paper summarizes the features of each economy that justify this forecast, and highlights some of the country-specific obstacles that could prevent its realization. Specifically, we contribute an analysis of the relative difficulty of doing business within each country and discuss how this, combined with a lack of long-term conditions to promote growth, affects the potential of these markets to lead the future world economy.

This paper assesses the reactions of the United States and the twelve economies of the European Monetary Union (EMU) to the financial crisis of 2008-2009. The rapidly spreading financial and economic contagion uncovered structural problems of each member of the EMU that impacted their relative competitiveness. Furthermore, the crisis highlights the scale and scope of interdependences in the world economy. It unveiled economic and institutional flaws in the EMU, the European Union (EU) and the U.S. Additionally, in the U.S., the crisis brought to light institutional and industry conflicts of interest, as well as glaring regulatory failures.

Financial markets have experienced unprecedented transformations, signs of which have emerged since the late 1970s. In recent years substantial consolidation occurred. In response to changes in macroeconomic variables, such as GDP, industrial production, inflation and the political business cycle, the institutional structure of stock exchanges has evolved in terms of economic performance. This paper compares the performances of financial markets and presents comparisons of the leading five stock exchanges by studying the evolution of the unitized risk values for real rates of return during the 1950-2012 time-period.

This paper examines the determinants of the premia between the black and official exchange rates using monthly data for 17 developing countries. The premium is hypothesized to be positively influenced by the official depreciation-adjusted interest rate differential and dollar value of domestic assets. It is hypothesized to be negatively influenced by the official real exchange rate, exports, and a seasonal factor associated with tourism. The countries studied are: Bangladesh, Brazil, Fiji, Gambia, Ghana, Guyana, Hungary, Ireland, Jamaica, Kenya, Nepal, Nigeria, Philippines, Somalia, South Africa, Uganda, and the former Yugoslavia. In general, the results are very supportive of the model. It is found that the interest rate differential and assets positively influence the premium, as is expected. The official real exchange rate is found to negatively influence the premium.

This study examines value implications of remedial actions of the Securities Exchange Commission during the year 2011 that culminated in delisting a number of Chinese companies from the U.S public exchanges. To achieve that we examine the institutional characteristics and performance of Specified Purpose Acquisition Companies (SPACs) used as a financing tool and gateway to the U.S. capital markets by Chinese companies in period 2004-2011. The overall evidence presented shows that SPACs merging with companies from China are not inferior corporate structure in respect to the other SPACs. While their institutional characteristics are similar, the performance tests show that these Chinese SPACs lost value around SEC decision dates but in overall they outperform other SPACs listed in the U.S. capital markets.

This paper explores the impacts of the Federal Funds Rate (FFR), a significant money market indicator, on the prime lending rates offered by commercial banks. Prior to 1994, the FFR had lagged effects on prime rates, but since the second quarter of 1994, the Federal Reserve Bank has implemented monetary policy which explicitly and publicly target the FFR. Commercial banks have since relied on the FFR to promptly modify the prime rate in response to changing policies. The results of the study signify that transparency in monetary policy targeting can facilitate desired effects, thereby increasing efficiency.

The paper discusses the differences among countries of the Eurozone which impede growth. The paper offers solutions aimed at encouraging economic convergence to a higher level of standard of living. Economic disparity throughout the region has increased due to the global financial crisis. A common currency is insufficient for economic growth. Sectoral policies need to be considered aimed at increasing equality among country members. The authors explore how the European Union may consider stimulating specific sectors in order to achieve real convergence and spur socioeconomic development in the Eurozone countries.

Since 1980, as most advanced economies deregulated their capital markets, removed barriers to international investments, and improved the accessibility to information, investors in many countries have adopted a global view. These trends are especially pronounced in Europe, where European Community (EC) countries have embarked on a process of unifying their economies and their financial markets. The Maastricht treaty, which was agreed to by EC leaders in December 1991, established the steps toward a currency union and closer political integration. Moreover, by 1996, the EC Investment Services Directive will allow stockbrokers to operate across national borders without the need to establish local subsidiaries. Global trends notwithstanding, European financial intermediaries, investors, and corporations are national rather than pan-European in character. There are substantial differences among EC countries in the regulation of national securities markets, taxes, corporate laws, and accounting practices. Barriers to crossborder investments, e.g., pension funds, remain. The purpose of this study is to examine the dynamic linkages among the eight major EC stock markets. The interdependence among national stock markets has been the subject of several recent papers (Schollhammer & Sand, 1985, 1987; Eun & Shim, 1989; Merit & Merit, 1989; Jeon & Von Furstenberg, 1990; Von Furstenberg & Jeon, 1989; Koch & Koch, 1991). These studies were motivated by growing recognition of the benefits of international portfolio diversification (e.g., Grubel, 1968; Grubel & Fadner, 1971; Levy & Samat, 1970; Agmon, 1972) and the international propagation of the October 1987 crash (e.g., Malliaris & Urrutia, 1992). None of these studies solely focused on Europe.

This paper evaluates the net benefits yielded by residential and commercial burglar and fire alarm systems. The policy issue addressed is whether or not alarms should be encouraged by local police departments as a crime prevention measure. It is shown that the total benefits of burglar alarm ownership outweigh the total costs for the combined and separate commercial and residential units. Police respond to each activation with two patrol cars. On the average, alarms are activated 1.12 times a year, and 94 to 98 percent of all activations are false. Thus, alarms impose a significant burden on police resources. Additionally, the fear of being fined is not an effective deterrent against the installation of a burglar alarm. The data was gathered from a suburban community in Pennsylvania that is a prototype for many U.S. suburban localities. The data is regarding individual properties collected from police files on the attributes of burglaries and alarm ownership. Attributes of properties were derived from the real estate board of the county. Data on incidents and the value of property stolen was obtained from questionnaires sent out to all burglary victims.

This study documents the changes in the corporate design of modern Specified Purpose Acquisition Companies (SPACs) for the years 2003 to 2012. Do institutional characteristics of SPACs determine the success of their merger outcomes? The paper finds that SPACs significantly redesigned their structure in the period under observation. In addition, the probability of a merger for SPACs increases if they are able to announce the deal soon after the Initial Public Offering (IPO), if the deal focuses on China and when their IPO is underwritten by EarlyBirdCapital.

This paper shows, using a simple model, that wasteful innovations may result in a loss-loss situation where no country experiences an increase in welfare. If some countries introduce innovations that result in harmful effects on other countries, it may cause the adversely affected countries to retaliate by imposing impediments to international trade. In a globalized and integrated World economy, such policies can only harm the countries involved. Thus, it is in both countries' best interest to encourage sustainable coordination between policies in order to better their own citizens, as well as the World's aggregate welfare.

This paper explores the impact of volatility estimation methods on theoretical option values based upon the Black-Scholes-Merton (BSM) model. Volatility is the only input used in the BSM model that cannot be observed in the market or a priori determined in a contract. Thus, properly calculating volatility is crucial. Two approaches to estimate volatility are implied volatility and historical prices. Iterative techniques are applied, based on daily S&P index options. Additionally, using option data on S&P 500 Index listed on the Chicago Board of Options Exchange, historical volatility can be estimated.

From 1980-2009 the Polish economy experienced structural dislocation. The growth and success of the Solidarity movement represented the shift in manufacturing from Soviet bloc trade to membership in the European Union. This paper examines four independent metrics that measure the changing “sophistication” of trade patterns during this modal shift. The common theme underlying the analysis of these indices is that the Polish economy is resilient and adaptable. Poland is expected to compete effectively in its new economic environment after a period of adjustment and progress.

What can economists learn from dynamic partial control of chemical reactors? Both chemical reactors and the economy involve many variables that are difficult to fully predict or control. Thus, this paper suggests the use of partial control, which involves indentifying only the key variables that monitor the system. This idea of observing relatively few variables and enabling policy makers to better control the economy is in line with the contributions of Sargent and Sims, who use a limited number of variables to study monetary and fiscal policies. This approach enables a better distinction between cause and effect in the macroeconomy.

The European Union was created to promote economic, cultural, and regional prosperity. However, the Global Financial Crisis demonstrates that its economic institutions are flawed. While each sovereign state in the Eurozone forfeits the control of its money supply, the lack of a common fiscal institution allows individual countries to pursue their own political and financial agendas. The on-going economic hardship emphasizes the critical role of economic and political institution ions. This paper analyzes both beneficial and perverse incentives of joining the European Union, discusses the consequences of deficient economic institutions and provides potential solutions towards the alleviation of the crisis.

This paper uses the structure of institutional economics to provide an explanation of the recent U.S. financial crisis. Institutional theory suggests that a county’s political, legal, social, and cultural institutions determine and characterize its economy. An institutional perspective of financial crises therefore incorporates unquantifiable aspects of the real world. Different institutions interacted to ignite and fuel the global crisis. A thorough understanding of all of the legal, political, and cultural institution that encompass a society, as well as their role in the market, is needed to explain and avoid the reoccurrences of financial crises.

This paper examines the intra-industry trade of the four East Asian Newly Industrialized Countries (Hong Kong, Singapore, South Korea and Taiwan) with European markets, Japan and the United States over the period 1965–1990. Five hypotheses are tested: (1) the effects of product differentiation; (2) the presence of scale economies; (3) the broadening of economic bases as the country's GNP increases; (4) the influence of multinational corporations (MNCs); and (5) the income-similarity (Linder) Hypothesis. The paper notes the empirical relevance of Inter-Industry trade for NIC exports, and finds empirical support for several theoretical explanations of this phenomenon. ( JEL F14)

This paper examines the where, when and why of first round entrepreneurial investment activity in the United States from the first quarter of 1995 until the second quarter of 2010. The paper analyzes these venture capital investments taking into consideration the role of macroeconomic variables, region, and industry. Additionally, trends in regional and industrial investments are evaluated using statistical and graphical analyses. By studying these findings, we are able to understand the impact of different periods of economic growth on venture capital investments. Lastly, the shock of the dot.com bubble and recent financial crisis are integrated into the findings.

This paper analyzes the theoretical foundations of Giffen goods and details the difficulty with which prior studies have encountered limited empirical proof of Giffenity. Subsequently, a discussion of the economic overview of Russia during the early 1990s is provided. The paper then applies Giffenity to the newly established free market system of post-Soviet Union Russia while acknowledging changes in the prices for goods, specifically, for inferior food commodities. The paper concludes by advocating for the need to incorporate Giffenity into current economic theory to make it more comprehensive.

Spain has experienced many financial crises through its history. These financial crises have varied origins. However, they do have common threads. The current recession and subsequent debt crisis follow the same pattern. The fiscal and monetary policies of the Spanish government have played a role in creating and prolonging the boom and bust cycles. Government spending, government regulation, credit institutions, budget deficits, the political climate, and international trade are discussed to illuminate the causes and effects of these business cycles. The Spanish government can take action to improve the economy and to lessen the effects of its financial crises.

Economic Geography maintains that economic activities are not randomly distributed across space. This paper examines the impact of industrial and regional characteristics on venture capital activities in the United States from 1995 until 2009. The unique database allows for stratifications into seventeen industries within nineteen regions of the United States. This study affirms the significance of both location and industry in venture capital investment. Both statistical and graphical methods are employed in order to better ascertain the dynamic nature of the data.

Development economists agree that increasing export diversification is a concomitant to economic development. An accepted explanation for Africa’s export stagnation is its dependence on monoculture, and on small number of commodities. Recently a large body of literature focuses on the relationship between economic growth and export specialization. However, there does not exist one generally acceptable measure or index for the concept of “Specialization in International Trade”. This paper suggest one such measure for specialization and its theoretical and conceptual framework are developed and applied to Singapore, South Korea, Malaysia, Mexico, Tunisia and Morocco, during the years of their take offs.

What are the effects of macroeconomic variables on venture-backed capital investment in environmentally friendly industries in the United States? What is the significance of location in determining both the number of deals and amount of investment by venture capital in the Clean-tech industry? The Clean-tech sector encompasses those firms that actively incorporate environmental concerns into their products and services. The sector contains environmentally progressive companies from many different traditional, functionality-based industries such as software, energy, telecommunications, etc. This paper ascertains the effects of macroeconomic variables and the location on venture-capital backed investment in the Clean-tech industry in the United States.

The examination of U.S. crises reveals that the current financial crisis follows past patterns. An investment bubble creates excess demand for new financing instruments. During the railroad bubbles of the nineteenth century loans were issued at a pace higher than many companies could pay back. The current housing bubble originated from issuing sub-prime mortgages that assume that housing prices would only rise. The increased demand for credit induces financial innovations and instruments that circumvent existing regulations. Inevitably, the bubble bursts. The history of financial crises teaches that policy reforms and new regulations cannot prevent future financial crises.

The economic history of the United States is riddled with financial crises and banking panics. During the nineteenth-century, eight major such episodes occurred. In the period following World War II, some believed that these crises would no longer happen, and that the U.S. had reached a time of everlasting financial stability and sustainable growth. The Savings and Loans Crisis of the 1980s, the 2001 dot-com bust and the 2007 housing bubble that led to the current global financial crises demonstrate that these phenomena are still reoccurring. Regulators and policy makers should keep aware of the recurrence of such crises.

As our trading world becomes more globalized, who benefits and who gets hurt? This paper relies on the Ricardian model to explore the effects of technological improvements in underdeveloped countries on the welfare of developed countries. For example, trading between the United States and China, which has undergone a technological improvement in commodities which China imports and exports, may lead to different welfare implications for both countries. The paper models several scenarios to indicate and demonstrate the arguments for and against globalization. The findings suggest that certain policies should be implemented to maintain and enhance the competitiveness of developed countries.

The State of Qatar is driven mainly by hydrocarbon revenues, which are estimated to support this tiny country for hundreds of years. The Qatari economy is becoming diversified with industries such as manufacturing, banking, social services, and tourism. Additionally, government financed health and educational services have increased rapidly. However, the Qatari government is not able to establish necessary laws and procedures which business requires. Despite recent changes, Qatari laws and regulations are not always friendly towards business ventures or foreign investment, hindering economic growth. Furthermore, enforcement of existing business regulations and rules are occasionally lacking.

This paper examines venture capital investment activity in the United States during the period 1995 to the first quarter 2009, taking into consideration both location and industry sector. The research question is whether industry and region are important factors in determining venture capital investment. Furthermore, the paper explores the effects of macroeconomic variables on investment activity. Consequently, the venture capital data are augmented by Gross Domestic Product (GDP), Federal Funds Rate, three, five and ten year interest rates. By examining long term trends, the effect of the current economic crisis on venture capital investment may be better understood.

Economic geography receives limited consideration in the venture capital literature. This study utilizes thirty years of data concerning companies that initially were backed by venture capital. These firms are located in Entrepreneurial Focal Points in the United States, namely: California, Massachusetts, New York, Pennsylvania and Texas. How well do these companies operate once they go public? Do the scrutiny measures, expertise and financial backing that firms gain from the venture capitalists increase their annual and cumulative returns? The results show that returns on investment are adequate given their substantial risk.

The Sultanate of Oman has a diversified economy, unlike many of its neighboring nations that rely almost entirely on oil revenues. Natural gas and several non-energy business sectors, such as tourism, fishing, light manufacturing, and agriculture are expanding rapidly. The Omani economy is one of the freest in its region. A relatively stable government and low taxes make Oman a desirable location for entrepreneurial ventures. Furthermore, foreign direct investment is welcomed. Tourism is the most attractive area for international entrepreneurs. Oil revenues, coupled with increasing foreign investment are likely to both diversify the Omani economic base and strengthen it.

As current trends of Chinese economic growth and motorization continue, its demand for higher efficiency fuels (oil, gas, and electric power) will increase. This, coupled with China's limited domestic production, can translate into a massive demand for energy imports. To predict China's energy demand into 2020, an econometric model of the Chinese energy economy is constructed based on its energy balance. This paper suggests that China's increase demand for energy imports will be most sensitive to increases in motorization rather than economic growth. It can be partially offset by increasing domestic energy production or energy efficiency.

This paper utilizes Vector Auto Regression (VAR) models to analyze the interdependence among exchange rates of twelve Asian-Pacific nations, Australia, China, Indonesia, Japan, Malaysia, New Zealand, Philippines, South Korea, Singapore, Taiwan, Thailand, and Vietnam. The daily data span from 1995 to 2004. It finds strong regional foreign exchange dependency, varying from 32 to 73 percent. This network of markets is highly correlated, with shocks to one reverberating throughout the region. Despite the linkages of the Chinese exchange rate to the United States dollar, the Chinese foreign exchange is not as independent with respect to its South-Asian neighbors as previously thought.