The Credibility of Hong Kong's Link from the Perspective of Modern Financial Theory
利用金融资产价格提取市场预期信息，研究香港联系汇率制度历次调整如何影响其可信度，发现减少人为干预能增强制度可信度。
Hong Kong’s Linked Exchange Rate system (LERS) has been in operation since 1983 during which time many other fixed exchange rate systems have succumbed to shocks and/or speculative attacks. This paper investigates how market participants assessed changes made to the LERS by using the tools of modern finance to extract information from financial asset prices about market expectations. These changes have been characterized as making the system less discretionary over time. We find that decreasing the discretionary element of the LERS led to an increase in credibility of the arrangement.