The credit crunch in East Asia : what can bank excess liquid assets tell us ?
AbstractThe authors propose a two-step approach for assessing the extent to which the fall in credit in crisis-stricken East Asian countries was a supply- or demand-induced phenomenon. The first step involves estimating a demand function for excess liquid assets held by commercial banks. The second step involves establishing dynamic projections for the periods after the crisis and assessing whether or not residuals are large enough to be viewed as indicators of an"involuntary"accumulation of excess reserves. The results for Thailand suggest that the contraction in bank lending that accompanied the crisis was the result of supply factors. Thai firms (presumably small and medium-size ones) faced binding constraints in getting access to credit markets after the crisis.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 2483.
Date of creation: 30 Nov 2000
Date of revision:
Economic Theory&Research; Banks&Banking Reform; Environmental Economics&Policies; Financial Intermediation; Settlement of Investment Disputes;
Other versions of this item:
- Agenor, Pierre-Richard & Aizenman, Joshua & Hoffmaister, Alexander W., 2004. "The credit crunch in East Asia: what can bank excess liquid assets tell us?," Journal of International Money and Finance, Elsevier, vol. 23(1), pages 27-49, February.
- P.R. Agenor & J. Aizenman & A. Hoffmaister, 2000. "The Credit Crunch in East Asia: What can Bank Excess Liquid Assets Tell us?," NBER Working Papers 7951, National Bureau of Economic Research, Inc.
- E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
- F31 - International Economics - - International Finance - - - Foreign Exchange
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