Finance and the real economy: Theoretical implications of the financial crisis in Asia

Abstract

This paper offers a preliminary assessment of some implications of the Asian financial crisis for theories about the development of a global economy. The paper (i) draws together some of the available evidence about the history of the crisis, and (ii) identifies some current diagnoses of its cause before (iii) arguing that the central implication of the crisis is that it enables us to identify the manner in which the financial and real economies are linked. While the evidence about the chain of events and causes in this crisis still remains scattered, most diagnoses point to the particular economic and political characteristics of the specific countries involved: the financial crisis reflect..