Using principal component analyses, this paper constructs two internationalization indices for the renminbi （RMB） and 32 other major currencies. We find that the RMB＇s currency internationalization degree index （C...Using principal component analyses, this paper constructs two internationalization indices for the renminbi （RMB） and 32 other major currencies. We find that the RMB＇s currency internationalization degree index （CIDI） is still low, and far behind the 4 most important international currencies. In 2009, it was ranked 18th among all important international currencies. However, in terms of the currency internationalization prospect index （C1PI）, the RMB has remained the world ＂s fifih highest since 2006. Although it is still far behind the US dollar and the euro, surpassing the ranking of the yen and the pound is possible in the near future. The dramatic difference in the ranking between the CIDI and the CIPI is a result of China＇s tight capital account control, the usage continui01 of international currency due to network externalities, and the narrow foreign exchange and imperfect financial markets. Hence, to a large degree, the RMB ＇s potential as an international currency depends on China＇s capital account liberalization.展开更多
Most studies of renminbi internationalization focus on the supply side, by examining China＇s own economic and political conditions. In contrast, this study addresses the demand side of renminbi internationah＇zation,...Most studies of renminbi internationalization focus on the supply side, by examining China＇s own economic and political conditions. In contrast, this study addresses the demand side of renminbi internationah＇zation, by providing an in-depth analysis of renminbi use in ordinary foreign economies from both economic and political perspectives, with a particular focus on South Korea, China＇s next-door neighbor. The study finds that sustainable indigenous market forces facilitating renminbi use in South Korea remain weak, despite the country＇s close economic ties with China. This research also shows, however, that the Korean Government has itself recently been able, through its policy measures, to generate new domestic support for greater use of the renminbi. These findings ultimately highlight the significant impact on the internationalization of a currency of the politics in the foreign countries using it.展开更多
文摘Using principal component analyses, this paper constructs two internationalization indices for the renminbi （RMB） and 32 other major currencies. We find that the RMB＇s currency internationalization degree index （CIDI） is still low, and far behind the 4 most important international currencies. In 2009, it was ranked 18th among all important international currencies. However, in terms of the currency internationalization prospect index （C1PI）, the RMB has remained the world ＂s fifih highest since 2006. Although it is still far behind the US dollar and the euro, surpassing the ranking of the yen and the pound is possible in the near future. The dramatic difference in the ranking between the CIDI and the CIPI is a result of China＇s tight capital account control, the usage continui01 of international currency due to network externalities, and the narrow foreign exchange and imperfect financial markets. Hence, to a large degree, the RMB ＇s potential as an international currency depends on China＇s capital account liberalization.
文摘Most studies of renminbi internationalization focus on the supply side, by examining China＇s own economic and political conditions. In contrast, this study addresses the demand side of renminbi internationah＇zation, by providing an in-depth analysis of renminbi use in ordinary foreign economies from both economic and political perspectives, with a particular focus on South Korea, China＇s next-door neighbor. The study finds that sustainable indigenous market forces facilitating renminbi use in South Korea remain weak, despite the country＇s close economic ties with China. This research also shows, however, that the Korean Government has itself recently been able, through its policy measures, to generate new domestic support for greater use of the renminbi. These findings ultimately highlight the significant impact on the internationalization of a currency of the politics in the foreign countries using it.
