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Global Economic Effects of the Asian Currency Devaluations


  • Marcus Noland

    (Peterson Institute for International Economics)

  • Li-Gang Liu

    (Institute for International Economics)

  • Sherman Robinson

    (Institute for International Economics Author -Name: Zhi Wang
    Institute for International Economics)


The Asian financial crisis has precipitated significant changes in real exchange rates in the region that will substantially alter the volume and pattern of international trade. The crisis countries will increase their exports and, especially, reduce their imports. Japan, China, and the other non-crisis countries will experience more complex changes. The trade balances of the United States and Western Europe will deteriorate by about $40-50 billion as a result of the currency movements in Asia. * This study, newly updated in August 1999, quantifies the impact of the currency changes on the individual countries in Asia, on the United States, on Europe and on other regions on a sector-by-sector basis. It analyzes the additional impact that might occur if China, thus far a relative bystander in the crisis, were to devalue its currency as well. It then examines potential trade policy responses to these developments including the risk of an upsurge in protectionist pressure in the United States.

Suggested Citation

  • Marcus Noland & Li-Gang Liu & Sherman Robinson, 1998. "Global Economic Effects of the Asian Currency Devaluations," Peterson Institute Press: All Books, Peterson Institute for International Economics, number pa56.
  • Handle: RePEc:iie:ppress:pa56
    Note: Policy Analyses in International Economics 56

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    References listed on IDEAS

    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2011. "From Financial Crash to Debt Crisis," American Economic Review, American Economic Association, vol. 101(5), pages 1676-1706, August.
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    Cited by:

    1. Dirk WILLENBOCKEL & Sherman ROBINSON, "undated". "The Global Financial Crisis, LDC Exports and Welfare: Analysis with a World Trade Model," EcoMod2009 21500091, EcoMod.
    2. Kalpana Kochhar & Prakash Loungani & Mark R. Stone, 1998. "The East Asian Crisis; Macroeconomic Developments and Policy Lessons," IMF Working Papers 98/128, International Monetary Fund.
    3. Cheung, Yin-Wong & Chinn, Menzie D. & Fujii, Eiji, 2006. "The Chinese economies in global context: The integration process and its determinants," Journal of the Japanese and International Economies, Elsevier, vol. 20(1), pages 128-153, March.
    4. Rod Tyers & Yongzheng Yang, 2004. "The Asian Recession and Northern Labour Markets," The Economic Record, The Economic Society of Australia, vol. 80(248), pages 58-75, March.
    5. Noland, Marcus, 2000. "The Philippines in the Asian Financial Crisis: How the Sick Man Avoided Pneumonia," MPRA Paper 55665, University Library of Munich, Germany.
    6. ADKINS Liwayway G. & GARBACCIO Richard F., "undated". "Simulating the Effects of the FTAA on Global Carbon Emissions: A General Equilibrium Analysis," EcoMod2003 330700000, EcoMod.
    7. Fernald, John & Edison, Hali & Loungani, Prakash, 1999. "Was China the first domino? Assessing links between China and other Asian economies," Journal of International Money and Finance, Elsevier, vol. 18(4), pages 515-535, August.
    8. Patricia S. Pollard & Cletus C. Coughlin, 1999. "Going down: the Asian crisis and U.S. exports," Review, Federal Reserve Bank of St. Louis, issue Mar, pages 33-46.
    9. Cheung, Yin-Wong & Chinn, Menzie D. & Fujii, Eiji, 2003. "China, Hong Kong, and Taiwan: A quantitative assessment of real and financial integration," China Economic Review, Elsevier, vol. 14(3), pages 281-303.
    10. Sherman Robinson & Zhi Wang & Will Martin, 2002. "Capturing the Implications of Services Trade Liberalization," Economic Systems Research, Taylor & Francis Journals, vol. 14(1), pages 3-33.
    11. S.M. Shafaeddin, 2004. "Who Is The Master? Who Is The Servant? Market Or Government? An Alternative Approach: Towards A Coordination System," UNCTAD Discussion Papers 175, United Nations Conference on Trade and Development.
    12. repec:pra:mprapa:15377 is not listed on IDEAS
    13. Cletus C. Coughlin & Patricia S. Pollard, 2000. "State exports and the Asian crisis," Review, Federal Reserve Bank of St. Louis, issue Jan, pages 3-14.
    14. M. Serrano & Marián Boguñá & Alessandro Vespignani, 2007. "Patterns of dominant flows in the world trade web," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 2(2), pages 111-124, December.
    15. Qiao, Hong, 2007. "Exchange rates and trade balances under the dollar standard," Journal of Policy Modeling, Elsevier, vol. 29(5), pages 765-782.

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