The implications of different exchange rate policy arrangements have long been a central issue in international economic analysis. Because of the diversity of historical backgrounds, stages of economic development, and financial market environments among countries in the Pacific Basin, this region provides an ideal laboratory for a comparative study of exchange rate arrangements and their implications for monetary policy. Moreover, the Pacific Basin has become widely recognized as the most dynamic region in the world economy. Much attention has focused on issues related to international trade with Pacific Basin countries. Only recently have exchange rate and financial policy issues come to the forefront, as countries in the region have become more integrated with one another and with the rest of the world through international capital as well as trade movement.

This volume is a collection of essays originally prepared for a conference titled “Exchange Rate Policy in Pacific Basin Countries” sponsored by the Center for Pacific Basin Monetary and Economic Studies at the Federal Reserve Bank of San Francisco on September 16–18, 1992. The conference brought together academics, central bankers, and other policymakers and researchers to review and compare the experiences of Pacific Basin countries. The essays in this volume provide a comprehensive analysis of the theoretical issues associated with exchange rate policies as well as the individual experiences of Pacific Basin countries.