Article thumbnail

Monetary Transmissions Immediately after the Crisis in East Asia

By Masahiro Enya and Akira Kohsaka

Abstract

We examine dynamic patterns of macroeconomic variables in East Asia immediately after the Asian financial crisis. Particularly, focusing on East Asia, we can identify their distinctive features from those of aggregate cross-country results. Also, we check with the financial crises in East Asia in the 1980s in order to make sure to what extent the contrast between the aggregate cross-country results and that of the Asian financial crisis comes from differences in time (external environment) or in country structure or both. Some distinctive features in East Asia include higher real interest rates in the crisis year, persistent output as well as investment slowdown, and different behaviors of trade and fiscal surpluses after the crisis. The results suggest that initial monetary tightening be responsible for the unexpectedly serious recession and that favorable external conditions and fiscal stimulus did contribute to the post-crisis real recovery even without credit recoveries.macroeconomic dynamics, East Asia, financial crisis

OAI identifier:

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.

Suggested articles

Citations

  1. (1999). [1999], “East Asia in the Aftermath: Was There a Crunch?” IMF Working Paper, WP/99/38,
  2. (2000). 1. Macroeconomic Dynamics after the Financial Crises: Cross-Country, 1980-1995 Output Prices Interest rates Real GDP Inflation Exchange Rate Short-term Loan Deposit Spread Growth Rate Depreciation (real) (real) (real)
  3. (2000). Akira [2000], "A Quest for A New International Financial Architecture: An AsianPacific Perspective," Paper presented at the
  4. (2000). Alexandros Mourmouras, and Steven Philipps [2000], “Managing Financial Crises: The Experience in East Asia,”
  5. (1997). Bank Insolvency:
  6. (2001). Chul and Hong-Wha Lee [2001], “Recovery and Sustainability in East Asia,”
  7. (2000). Enrica Detragiache, and Poonam Gupta [2000], “Inside the Crisis: An Empirical Analysis of Banking System
  8. (1999). Fund [1999], World Economic Outlook,
  9. (1995). Inside the Black Box: The Credit Channel of Monatary Transmission,”
  10. (1998). Is There a Credit Crunch in East Asia," World Bank Policy Research Working Paper
  11. (1999). Reinhart [1999], "The Twin Crises: The Causes of Banking and Balance-of-Payments Problems," American Economic Review,
  12. Sachs [1998], “The Asian Financial Crisis: Diagnosis, Remedies,