02050cas a2200253 a 4500 AALejournalIMF013174 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475542851 1018-5941 BD-DhAAL BD-DhAAL Alp, Harun. Shock Therapy! : What Role for Thai Monetary Policy? / Harun Alp, Selim Elekdag. Washington, D.C. : International Monetary Fund, 2012. 1 online resource (48 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Thailand had to endure three major shocks during 2008-2011: the global financial crisis, the Japanese earthquake, and the Thai floods of 2011. Over this period, consistent with its inflation targeting framework, the Bank of Thailand (BOT) let the exchange rate depreciate and cut interest rates (to, for example, a historically low level of 1u percent by mid-2009). This paper seeks to uncover the role of monetary policy in softening the impact of these shocks. Specifically, it seeks to address the following question: if an inflation targeting framework underpinned by a flexible exchange rate regime had not been in place, how would the economic contractions associated with these shocks have differed? Counterfactual simulations based on an estimated structural model indicate that countercyclical monetary policy and exchange rate flexibility added up to a total of 4 percentage points to real GDP growth during periods when Thailand had to weather these three major shocks. Mode of access: Internet Elekdag, Selim. IMF Working Papers; Working Paper ; No. 2012/269 Full text available on IMF http://elibrary.imf.org/view/journals/001/2012/269/001.2012.issue-269-en.xml IMF e-Library