Asian Crisis: Distilling Critical Lessons
AbstractThe virulent crisis that struck five Asian economies in mid-1997 and 1998 raised concern about the stability of the global financial system. The financial crisis and market turbulence caused a steep fall in output, and thus had high economic and social costs. The crisis-stricken economies made concerted endeavours to restructure, and by early 2000 we could justly say that these economies were on the recovery path. This development is well captured in the quarterly GDP movements of the five crisis-affected economies: Indonesia, Malaysia, the Philippines, the Republic of Korea and Thailand. One of the silver linings of adversity is that it teaches valuable lessons. In this Discussion Paper we take stock of the policy lessons of the Asian crisis. These lessons could help policy makers, inter alia, to cope with the increasingly integrated capital markets and heightened capital movements. Indeed, the lessons enumerated in this paper will not prevent future crises from occurring, but may reduce their probability and limit their effects when they do. The lessons that the Asian crisis has provided cover several policy areas including macroeconomics, microeconomics, banking and finance, prudential regulations, and global financial architecture. An attempt has been made to cover a wide canvas and focus on several, certainly not all, important areas.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. 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.
Bibliographic InfoPaper provided by United Nations Conference on Trade and Development in its series UNCTAD Discussion Papers with number 152.
Date of creation: 2000
Date of revision:
Contact details of provider:
Postal: Palais des Nations, CH - 1211 Geneva 10
Phone: +41 22 907 12 34
Fax: +41 22 907 00 43
Web page: http://www.unctad.org/Templates/Page.asp?intItemID=2101&lang=1
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-09-05 (All new papers)
- NEP-FIN-2004-09-05 (Finance)
- NEP-HPE-2004-09-05 (History & Philosophy of Economics)
- NEP-IFN-2004-09-05 (International Finance)
- NEP-PKE-2004-09-05 (Post Keynesian Economics)
- NEP-SEA-2004-09-05 (South East Asia)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Miller, Merton, 1998. "Asian financial crisis," Japan and the World Economy, Elsevier, vol. 10(3), pages 355-358, July.
- Dornbusch, Rudi, 1999.
"After Asia: New Directions for the International Financial System,"
Journal of Policy Modeling,
Elsevier, vol. 21(3), pages 289-299, May.
- Rudiger Dornbusch, 1998. "After Asia: new directions for the international financial system," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 42(Jun), pages 177-186.
- Barry Eichengreen & Andrew K. Rose & Charles Wyplosz, 1996.
"Contagious Currency Crises,"
NBER Working Papers
5681, National Bureau of Economic Research, Inc.
- Krugman, Paul, 1979. "A Model of Balance-of-Payments Crises," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 11(3), pages 311-25, August.
- Jeffrey A. Frankel & Andrew K. Rose, 1996.
"Currency crashes in emerging markets: an empirical treatment,"
International Finance Discussion Papers
534, Board of Governors of the Federal Reserve System (U.S.).
- Frankel, Jeffrey A. & Rose, Andrew K., 1996. "Currency crashes in emerging markets: An empirical treatment," Journal of International Economics, Elsevier, vol. 41(3-4), pages 351-366, November.
- Caprio Jr., Gerard, 1998. "Banking on crises : expensive lessons from recent financial crises," Policy Research Working Paper Series 1979, The World Bank.
- Steven Radelet & Jeffrey Sachs, 1998. "The Onset of the East Asian Financial Crisis," NBER Working Papers 6680, National Bureau of Economic Research, Inc.
- Aaron Tornell, 1999.
"Common Fundamentals in the Tequila and Asian Crises,"
NBER Working Papers
7139, National Bureau of Economic Research, Inc.
- Aaron Tornell, 1999. "Common Fundamentals in the Tequila and Asian Crises," Harvard Institute of Economic Research Working Papers 1868, Harvard - Institute of Economic Research.
- Stanley Fischer, 1999. "On the Need for an International Lender of Last Resort," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 85-104, Fall.
- Michael Mussa & Giovanni Dell'Ariccia & Barry J. Eichengreen & Enrica Detragiache, 1998. "Capital Account Liberalization: Theoretical and Practical Aspects," IMF Occasional Papers 172, International Monetary Fund.
- Corsetti, Giancarlo & Pesenti, Paolo & Roubini, Nouriel, 1999.
"What caused the Asian currency and financial crisis?,"
Japan and the World Economy,
Elsevier, vol. 11(3), pages 305-373, October.
- Giancarlo Corsetti & Paolo Pesenti & Nouriel Roubini, 1998. "What Caused the Asian Currency and Financial Crisis?," Temi di discussione (Economic working papers) 343, Bank of Italy, Economic Research and International Relations Area.
- Corsetti, G. & Pesenti, P. & Roubini, N., 1998. "What Caused the Asian Currency and Financial Crisis?," Papers 343, Banca Italia - Servizio di Studi.
- Frederic S. Mishkin, 2000.
"Lessons from the Asian Crisis,"
NBER Working Papers
7102, National Bureau of Economic Research, Inc.
- Glick, Reuven & Rose, Andrew K., 1999.
"Contagion and trade: Why are currency crises regional?,"
Journal of International Money and Finance,
Elsevier, vol. 18(4), pages 603-617, August.
- Reuven Glick & Andrew K. Rose, 1998. "Contagion and Trade: Why Are Currency Crises Regional?," NBER Working Papers 6806, National Bureau of Economic Research, Inc.
- Reuven Glick & Andrew K. Rose, 1998. "Contagion and trade: why are currency crises regional?," Pacific Basin Working Paper Series 98-03, Federal Reserve Bank of San Francisco.
- Glick, Reuven & Rose, Andrew K, 1998. "Contagion and Trade: Why are Currency Crises Regional," CEPR Discussion Papers 1947, C.E.P.R. Discussion Papers.
- Berger, Allen N, 1995.
"The Relationship between Capital and Earnings in Banking,"
Journal of Money, Credit and Banking,
Blackwell Publishing, vol. 27(2), pages 432-56, May.
- Allen Berger, 1994. "The Relationship Between Capital and Earnings in Banking," Center for Financial Institutions Working Papers 94-17, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Allen N. Berger, 1994. "The relationship between capital and earnings in banking," Finance and Economics Discussion Series 94-2, Board of Governors of the Federal Reserve System (U.S.).
- Frederic S. Mishkin, 1991.
"Asymmetric Information and Financial Crises: A Historical Perspective,"
NBER Working Papers
3400, National Bureau of Economic Research, Inc.
- Frederic S. Mishkin, 1991. "Asymmetric Information and Financial Crises: A Historical Perspective," NBER Chapters, in: Financial Markets and Financial Crises, pages 69-108 National Bureau of Economic Research, Inc.
- Jason Furman & Joseph E. Stiglitz, 1998. "Economic Crises: Evidence and Insights from East Asia," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 29(2), pages 1-136.
- Barry J. Eichengreen & Inci Ã–tker & A. Javier Hamann & Esteban Jadresic & R. B. Johnston & Hugh Bredenkamp & Paul R. Masson, 1998. "Exit Strategies: Policy Options for Countries Seeking Exchange Rate Flexibility," IMF Occasional Papers 168, International Monetary Fund.
- Heiner FLASSBECK, 2002. "The Exchange Rate: Economic Policy Tool Or Market Price?," UNCTAD Discussion Papers 157, United Nations Conference on Trade and Development.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rachid Bouhia).
If references are entirely missing, you can add them using this form.