East Asia in the Aftermath: Was there a Crunch?
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
This paper uses a disequilibrium framework to investigate a possible credit crunch in the East Asian crisis countries (Indonesia, Korea, and Thailand) during 1997-98. It defines a credit crunch as a situation in which interest rates do not equilibrate supply and demand for credit and the aggregate amount is supply constrained, i.e. there is quantity rationing. In all three countries, rising real interest rates and weakening economic activity lowered credit demand and (with the exception of Indonesia in late 1997) there is little evidence of quantity rationing at the aggregate level—although individual firms may have lost access to credit.
Series:
Working Paper No. 1999/038
Subject:
Bank credit Capital adequacy requirements Commercial banks Credit Financial institutions Financial regulation and supervision Financial services Money Real interest rates
English
Publication Date:
March 1, 1999
ISBN/ISSN:
9781451845679/1018-5941
Stock No:
WPIEA0381999
Pages:
21
Please address any questions about this title to publications@imf.org