Fundamental determinants of the Asian crisis: The role of financial fragility and external imbalances (a comment)

Carmen Reinhart

MPRA Paper from University Library of Munich, Germany

Abstract: Motivated by the severe Asian crisis of 1997, Giancarlo Corsetti, Paolo Pesenti, and Nouriel Roubini make a fine contribution to the growing literature that analyzes the symptoms of a country's vulnerability to currency crises. While the sample of countries covered in the empirical analysis encompasses diverse regions, the discussion in the paper focuses primarily on the Asian crisis. In particular, the authors stress, as they have in their earlier papers, the key role played by weak fundamentals in undermining several of the Asian currencies. Financial sector fundamentals play an important role, but the authors also devote considerable attention to the countries' capacity to back their "implicit" contingent liabilities, particularly those of the local banking sector.

Keywords: Asia; financial; crisis; banks; currency; crash; liabilities; capital; flows (search for similar items in EconPapers)
JEL-codes: E58 E6 F30 F41 (search for similar items in EconPapers)
Date: 2001
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Published in Regional and Global Capital Flows: Macroeconomic Causes and Consequences (2001): pp. 42-45

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Related works:
Chapter: Comment on "Fundamental Determinants of the Asian Crisis: The Role of Financial Fragility and External Imbalances" (2001)
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