Optimal hedging decisions for Taiwanese corn traders on the way to liberalisation
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This paper examines the impacts of exchange rate risk on Taiwanese traders' decisions to hedge corn imports on US futures
markets. The results yield the conclusion that, in the absence of a market that provides proper tools to hedge against exchange
rate risk, the Taiwanese economy is incurring an observable social loss. Thus, further liberalisation is essential. Taiwan's
experiences can serve as an example for developing countries, as the world economy is becoming increasingly integrated.
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