The Yuan And The Yen's Potential Cooperation And Competition In The Monetary Cooperation Of East Asia

Monetary Corporation of East Asia has been a hot topic in recent years. As we all know, the corporation among the East Asia countries has better geographic advantages, a unified cultural foundation and broad interests of the space. But there exists some disagreement in historical perspective and self-interest-driven field etc, which leads the slow progress of Monetary Corporation of East Asia. The two crises'lessons provides an opportunity to Monetary Corporation in this area.The East Asia countries have gradually realized that it's really important to establish a relative independent and large area economic system in order to make sure that the national economic development remains stable and rapid. Now it is short of how to establish the central Monetary system so as to let other countries promote this system with great efforts together.It's thought that RMB and JPY should be the main part in the establishment of the central monetary system in Eastern Asia by way of theoretical analysis of the article. The article is divided in six chapter.The first chapter is introduction. First, the article shows the purpose and meaning of the topics from two economic crisis about economic implications of East Asian countries. Second, the next part is literature review, which illustrates research findings of the relationship between RMB and JPY in Monetary Corporation of East Asia with respect to Chinese and foreign scholars so far.And then, the article shows research content, ideas and possible innovations and shortcomings.The second chapter is reality and theoretical analysis. First, the article introduces the progress of Monetary Corporaton of East Asia up to date; second it shows the necessity and feasibility of Monetary Corporation of East Asia by the way of theoretical explanations. China and Japan are two countries with the strongest economic strength in East Asia area, the relation mode of the two countries' monetary will directly affect the procedure of Monetary Corporation of Eastern Asia. Therefore, correlation theory with the potential cooperation and potential competition of the two currency should be introduced at last and it will pave the way for below.The third chapter is the analysis of competition between RMB and JPY. The potential competition of the two currency will be analyzed from Competitive pressures of trade,Changes in trade relations and Economic relevance about China and Japan to other countries in East Asian. There exists huge Contrast about Chinese economy's high growth and Japanese economy.The High Growth of the Exports, foreign direct investment about China to East Asian area and so on make the economic relevance constantly reinforced. In East Asian area,the leadership of Japan is coming upon against the impact of China's economy. If the current progress goes on constantly, each country in Eastern Asian will possibly consider China more in currency circulation, monetary policy, etc. This will make RMB constantly reinforce JPY's domination.We can draw a conclusion that the potential competition between RMB and JPY is Gradually taking shape.The fourth chapter is the analysis of the potential cooperation between RMB and JPY. The section shows the potential cooperation from the analysis of economic dependency and the whole East Asia Economic and trade networks. On one hand, the two countries' economy has a strong complementarity. The two countries' volume of trade and direct investment is huge and will grow at a rapid rate, so the economic relevance will be enhanced constantly. The economic relationship is inseparable day by day, which will make the size of the circulation of currency trading enlarge constantly.On the other hand, the continuous improvement of the East Asia economic and trade network will make economic and trade relations fuse. Neither of the two currency possesses the dominate power on one's own. Only by the way of cooperation will insure economy in East Asia stable and then make the interests of both countries maximize. We can draw a conclusion, the potential cooperation between RMB and JPY has taken shape.The fifth chapter is the analysis of long, medium and short cooperation mode. First, we can conclude that the welfare effects of cooperation mode should be much larger than the competition mode from the way of comparison. Second, the cooperation mode of two currency should carry on in phase. Seen from short cooperation, the way of monetary cooperation should strengthen coordination; the effect of RMB should be gradually increased; at the same time,we should respect position and effect of JPY. Seen from medium cooperation, with the continue growth of China's economy,the Monetary Cooperation should strengthen coordination between RMB and JPY. Seen from long cooperation, RMB will be the lead mainly in monetary cooperation, owing to China's huge spending power and high-speed potential economic growth.The sixth chapter is conclusion. This section is summary about the relation between RMB and JPY, which indicates the shortcomings and the following research direction in the future. From the analysis of the relationship of the two currency, we can conclude the following conclusion: first,there exists potential cooperation and competition at the same time in different aspects.; second,the welfare of the monetary cooperation is lager than the competition,and cooperation is good to accelerate the procedure of Monetary Corporation of East Asia, making it to achieve multi-win situation; third, the two currency cooperation should carry on in phase based on a good communication mechanism. Because of the influence in each aspect, RMB and JPY should establish a sound, healthy and long-lasting communication mechanism so as to deepen bilateral understanding, resolve misunderstanding and reduce barriers.Monetary Corporation of East Asia is always the hot topic, and we have get lots of research results through the 10 years's research. The two countries' currency relationship is the important component of the system. In the past, domestic scholars usually do research in the two countries' currency mode standing on China's point of view; but the article shows the potential cooperation and competition by empirical analysis and divides cooperation mode into different times. At the same time, the date is quite new, which can reflect the real relation of RMB and JPY and also fill the blank of frame system. But the author is limited, there may be shortcomings about existing research results to Monetary Corporation of East Asia, so there may be some deficiency in depth of understanding of monetary cooperation between the two countries. The empirical research about relationship between RMB and JPY is not comprehensive enough, so it may be deficient in conclusions. This will provide the direction to the further amendments and research.