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Global Crisis, Exchange Rate Response, and Economic Performance: A Story of Two Countries in East Asia


  • Yun Jeong Choi
  • Doyeon Kim
  • Taeyoon Sung


We consider Korea and Japan in East Asia as the representative country of each of the two groups: high- versus low-depreciation economies during the 2008 global financial crisis. Although the two countries have geographical and industrial similarities, their exchange rate change during the crisis was notably opposite, and so were the macro-economic performances. Particularly, exchange rate and trade flows turned out to have played a major role in creating such differences. Exporting firms significantly outperformed the stock market in Korea, while underperforming in the Japanese stock market during the crisis. However, we could not find this pattern prior to the crisis. The difference caused by the exchange rate change, particularly in time of turmoil of the substantial economic recession and depreciation.

Suggested Citation

  • Yun Jeong Choi & Doyeon Kim & Taeyoon Sung, 2010. "Global Crisis, Exchange Rate Response, and Economic Performance: A Story of Two Countries in East Asia," Global Economic Review, Taylor & Francis Journals, vol. 39(1), pages 25-42.
  • Handle: RePEc:taf:glecrv:v:39:y:2010:i:1:p:25-42 DOI: 10.1080/12265081003701039

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    References listed on IDEAS

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    Cited by:

    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "The Aftermath of Financial Crises," American Economic Review, American Economic Association, vol. 99(2), pages 466-472, May.


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