Contagion effect and the Asian Financial Crisis
- 최초 등록일
- 2009.01.07
- 최종 저작일
- 2007.05
- 5페이지/
MS 워드
- 가격 1,000원
소개글
Political Economy of East Asia
Asian Financial Crisis 관련 보고서 6패이지 분량 (Reference 포함)
목차
Introduction
Contagion
Causes of Contagion
Contagion and Korea
Conclusion
본문내용
The origins of the 1997 Asian financial crisis can be traced back to the collapse of the Thai baht which eventually spread to its neighboring countries and led to the Asian meltdown. Those five most affected by the crisis were Indonesia, Korea, Malaysia, Philippines and Thailand. The causes of the crisis, its severity and timing lie both in the domestic and international political economies (Prakash 2001). What is striking however is the speed at which the crisis spread. Why did it spread so fast causing such widespread effects?
The sudden pull out of funds spread from Thailand to Korea, but the economic problems the two countries were facing were noticeably different. Thailand was facing current account deficits which inevitably led to a sharp decline in the local currency’s value when foreign creditors realized Thailand will not be able to pay its debt (Feldstein 1998). Korea paints a somewhat different picture, Chang (1998) argues that Korea was suffering from a temporary liquidity crisis. This came from short-term debt problems by inexperienced Korean merchant banks who over invested in unproductive investments. Hence Korea was not experiencing problems with an overvalued exchange rate nor a current account deficit. The Korean economy was not experiencing a case of fundamental structural insolvency (Feldstein, 1998). Given this case, why was Korea to experience such a big crisis? What led to the sudden pull out of funds in Korea? This is generally
참고 자료
1. Chang Ha-joon, Park Hong-jae, Yoo Chun Gyue (1998) Interpreting the Korean crisis: financial liberalization, industrial policy and corporate governance, Camb. J. Econ. 22(6):735-746
2. Dornbush Rudiger, Park Yung Chul, Claseens Stjin (2000) Contagion: Understanding How it Spreads, The World Bank Research Observer v15,no.2, p 177-97
3. Feldstein, Martin (1998) Refocusing the IMF, Foreign Affairs v77, p20
