A Study of international capital flows in Taiwan：1991~2005

• Main Authors: Shao-Ting Chang, 張韶庭
• Other Authors: Chao-Nan Chia
• Format: Others
• Language: zh-TW
• Published: 2008
• Online Access: http://ndltd.ncl.edu.tw/handle/76937408411853705440

碩士 === 淡江大學 === 國際貿易學系國際企業學碩士班 === 96 === This article applies a probit model to empirically estimate the effects of exchange rate fluctuations and international financial integration degree on the net capital flow in Taiwan using quaterly data covering the period from 1991 to 2005.Our finding proved that exchange rate fluctuations have generated negative effects to the net capital flow, indicating that financial instability might be eliminated by allowing fluctuations in foreign exchange rate. International financial integration can significantly generate adverse effect to financial stability. Finally, the interaction effect of the two variables is used to calculate the threshold that the extent to which the adverse effect of financial integration being eliminated by exchange rate fluctuation. Our data have shown that current level of international financial integration is too high to be eliminated by the exchange rate fluctuation.