Experiences with Monetary Integration and Lessons for Korean Unification

Journal Issue

Volume/Issue:: 1997/65
Series:: IMF Working Papers
Author(s):: Goohoon Kwon
Publisher:: INTERNATIONAL MONETARY FUND
Published Date:: May 1997
DOI:: http://dx.doi.org/10.5089/9781451962635.001
ISBN:: 9781451962635
ISSN:: 1018-5941
Page:: 35

This paper discusses the timing of monetary integration and supporting economic policies during a rapid and largely uncontrolled process of Korean unification. The paper concludes that the transitory use of a separate currency in each region and supporting economic policies would help limit the initial costs of unification although the extent of the eventual cost reduction would depend critically on the success of ensuing economic reforms in the North during the transition. Maintaining the competitiveness of the northern economy would need to be a primary policy objective in the case of an early introduction of a common currency.

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Experiences with Monetary Integration and Lessons for Korean Unification