Monetary Transmissions Immediately after the Crisis in East Asia

Masahiro Enya and Akira Kohsaka

No 04-05, Discussion Papers in Economics and Business from Osaka University, Graduate School of Economics

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.

Keywords: macroeconomic dynamics; East Asia; financial crisis (search for similar items in EconPapers)
JEL-codes: E5 O11 O53 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2004-03
New Economics Papers: this item is included in nep-bec, nep-cba, nep-mac, nep-mon and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:osk:wpaper:0405

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