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The Balance Sheet Approach To Financial Crises In Emerging Markets

Author

Listed:
  • Giovanni Cozzi

    (Department of Economics, SOAS University of London, UK)

  • Jan Toporowski

    (Department of Economics, SOAS University of London, UK)

Abstract

This paper contrasts the conventional balance sheet approach to the analysis of economic disturbances in emerging markets with the alternative balance sheet approach that applies and extends Minsky’s Financial Instability Hypothesis to (open) emerging market economies. Earlier balance sheet studies are flawed because of a failure to disaggregate firms’ balance sheets. Examination of such balance sheets in Thailand, Malaysia, Indonesia, Singapore and Hong Kong, suggests that firms in the three crisis countries shared common causes of financial fragility, but the level of financial development and the particular domestic economic and political situation also affected their situation.

Suggested Citation

  • Giovanni Cozzi & Jan Toporowski, 2006. "The Balance Sheet Approach To Financial Crises In Emerging Markets," Working Papers 149, Department of Economics, SOAS University of London, UK.
    • Handle: RePEc:soa:wpaper:149
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    References listed on IDEAS

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    Cited by:

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    2. Jan Toporowski, 2007. "European Banks In The Developing World," Working Papers 151, Department of Economics, SOAS University of London, UK.
    3. Chang, Kuang-Liang & Chen, Nan-Kuang & Leung, Charles Ka Yui, 2012. "The dynamics of housing returns in Singapore: How important are the international transmission mechanisms?," Regional Science and Urban Economics, Elsevier, vol. 42(3), pages 516-530.

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    More about this item

    Keywords

    Emerging Markets; Minsky; Financial Crises; Southeast Asia;
    All these keywords.

    JEL classification:

    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems

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