The Credit Crunch in East Asia: What can Bank Excess Liquid Assets Tell us?

Pierre-Richard Agénor, Joshua Aizenman and Alexander Hoffmaister

No 7951, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The paper proposes a two-step approach to assessing the extent to which the fall in credit in crisis-stricken East Asian countries was a supply- or demand-induced phenomenon. The first step is based on the estimation of a demand function for excess liquid assets by commercial banks. Such a function is derived analytically in the first part of the paper. The second step consists in establishing dynamic projections for the periods following the crisis and assessing whether or not residuals are large enough to be viewed as indicators of involuntary' accumulation of excess reserves. Results for Thailand indicate that the contraction in bank lending that accompanied the crisis was the result of supply factors.

JEL-codes: E42 F31 (search for similar items in EconPapers)
Date: 2000-10
Note: IFM
References: View complete reference list from CitEc
Citations: View citations in EconPapers (34)

Published as Agenor, Pierre-Richard, Joshua Aizenman and Alexander W. Hoffmaister. "The Credit Crunch In East Asia: What Can Bank Excess Liquidity Assets Tell Us?," Journal of International Money and Finance, 2004, v23(1,Feb), 27-49.

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Journal Article: The credit crunch in East Asia: what can bank excess liquid assets tell us? (2004)
Working Paper: The credit crunch in East Asia: what can bank excess liquid assets tell us ? (2000)
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