EconPapers    
Economics at your fingertips  
 

Revival of the Twin Deficits in Asian Crisis-affected Countries

Evan Lau (), S Abu Mansor and Chin-Hong Puah

Economic Issues Journal Articles, 2010, vol. 15, issue 1, 29-54

Abstract: This paper revisits the twin deficits argument in the Asian crisis-affected countries. We also include data from the 1997 crisis to examine the disparities in the empirical regularities governing the two deficits in these countries. Empirical results suggest that causality runs from budget deficit to current account deficit for Malaysia, the Philippines (pre-crisis) and Thailand, which fits well with the Keynesian view. For Indonesia and Korea the causality runs in the opposite direction while a bi-directional causality exists for the Philippines in the post-crisis era. As these countries are at a crossroad in the aftermath of the 1997 crisis, managing these deficits are indeed important policy options in promoting macroeconomic stability and sustainability in the region.

Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
http://www.economicissues.org.uk/Files/110Lau.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eis:articl:110lau

Access Statistics for this article

More articles in Economic Issues Journal Articles from Economic Issues Contact information at EDIRC.
Series data maintained by Dan Wheatley ().

 
Page updated 2017-08-16
Handle: RePEc:eis:articl:110lau