The Asian Financial Crisis: Origins, Implications, and Solutions

In the late 1990s, Korea, Thailand, Indonesia and Malaysia experienced a series of major financial crises evinced by widespread bank insolvencies and currency depreciations, as well as sharp declines in gross domestic production. This sudden disruption of the Asian economic `miracle' astounded many observers around the world, raised questions about the stability of the international financial system and caused widespread fear that this financial crisis would spread to other countries. What has been called the Asian crisis followed a prolonged slump in Japan dating from the early 1980s and came after the Mexican currency crisis in the mid-1990s. Thus, the Asian crisis became a major policy concern at the International Monetary Fund as well as among developed countries whose cooperation in dealing with such financial crises is necessary to maintain the stability and efficiency of global financial markets.
This book collects the papers and discussions delivered at an October 1998 Conference co-sponsored by the Federal Reserve Bank of Chicago and the International Monetary Fund to examine the causes, implications and possible solutions to the crises. The conference participants included a broad range of academic, industry, and regulatory experts representing more than thirty countries. Topics discussed included the origin of the individual crises; early warning indicators; the role played by the global financial sector in this crisis; how, given an international safety net, potential risks of moral hazard might contribute to further crises; the lessons for the international financial system to be drawn from the Asian crisis; and what the role of the International Monetary Fund might be in future rescue operations.
Because the discussions of these topics include a wide diversity of critical views and opinions, the book offers a particularly rich presentation of current and evolving thinking on the causes and preventions of international banking and monetary crises. The book promises to be one of the timeliest as well as one of the most complete treatments of the Asian financial crisis and its implications for future policymaking.

Inhalt
I Opening Remarks.- 1 The IMF and the Asian Crisis: A View from the Executive Board.- 2 The Asian Financial Crisis.- II Origins of the Asian Crisis.- 3 What Caused the Recent Asian Currency Crises?.- 4 Origins of the Crisis in Asia.- 5 Thoughts on the Origins of the Asian Crisis: Impulses and Propagation Mechanisms.- 6 Origins of the Asian Crisis: Discussion.- III Causes and Implications of the Asian Crisisthe Role of the Financial Sector, Domestic Policies, and Contagion.- 7 Precarious Credit Equilibria: Reflections on the Asian Financial Crisis.- 8 Causes and Implications of the Asian Crisis: An Indonesian View.- 9 The Korean Banking Crisis: Picking up the Pieces.- 10 Asian Currency Crisis.- 11 Causes and Implications of the Asian Crisis.- 12 The Yen and BoomBust Cycle in East Asia.- 13 Causes and Implications of the Asian Crisis: The Role of Financial Sector, Domestic Policies, and Contagion.- IV Response to the CrisisOverview and Case Studies.- 14 Asian Crisis: Causes and Remedies.- 15 Korea's Financial Sector Reforms.- 16 Whither Thailand?.- 17 Comment on Asian Crisis: Causes and Remedies.- 18 The East Asian Financial Crisis: A Year Later.- 19 Removing Financial Bottlenecks to Labor Productivity in Thailand.- V Containing the Risks of Future CrisisStrengthening the Regulatory Framework.- 20 What's Wrong with the IMF? What Would Be Better?.- 21 Containing the Risks of Future Crises: Strengthening the Regulatory Framework.- 22 Banking Fragility, Effectiveness, and Regulation in Less-Developed Countries.- 23 Comments on What's Wrong with the IMF and Containing the Risks.- 24 Commentary on What's Wrong with the IMF and Containing the Risks.- VI Early Warning Indicators, Transparency, and Market Response.- 25 ImprovingTransparency in Asian Banking Systems.- 26 Early Warning Indicators of Financial Crises.- 27 The Asian Crises: A New Breed or Déjà Vu?.- 28 The Inevitable Perils of a Precocious Giant.- 29 Banks and the Asian Crisis.- 30 The Signals Approach to Early Warning of Currency Crisis: Does It Work and Is There a Better Way?.- 31 Will Greater Disclosure and Transparency Prevent the Next Banking Crisis?.- VII Moral Hazard and the Role of International Rescue Programs.- 32 Moral Hazard Is Avoidable.- 33 Moral Hazard.- 34 Moral Hazard and the Role of International Rescue Programs.- 35 Moral Hazard and the Role of International Rescue Programs.- VIII The Future Role of the International Monetary Fund in International Rescue Operations.- 36 Bailing in the Private Sector.- 37 Does the IMF Have a Future? What Should It Be?.- 38 Comment on Bailing in the Private Sector and Does the IMF Have a Future.- 39 Less Is More in the New International Financial Architecture.- 40 Assessing IMF's Crisis Prevention and Management Record.- IX Lessons from the Crisis for the International Financial System.- 41 Lessons for the International Financial System.- 42 Lessons from the Crisis.- 43 An Analysis of Financial Crisis: Lessons for the International Financial System.- 44 Lessons from the Asian Crisis.- 45 An Analysis of Financial Crisis.- 46 Lessons from the Asian Crisis for the International Financial System.- X Summary.- 47 Conference Summary.- Conference Program.- Contributors.