This paper documents the unfolding process of the Korean crisis in 1997. First, we show that it was hard to predict the Korean crisis at least up till the first half of 1997. Our judgement is based on the pre-crisis behavior of the leading indicators of currency crisis, the financial market data such as forward exchange premium and yield spreads, and the cross- country probit analysis a la frankel and Rose(1996). Second, our chronology study demonstrates that the Korean government unnecessarily aggravated the situation by committing a series of policy mistakes in handling the crisis. Therefore, the government may not be responsible for not preventing the crisis but it was surely responsible for exacerbating the situation after the crisis started.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by Institute of Economic Research, Seoul National University in its series Working Paper Series with number
no3.