BY: ETHAN KAPLAN
Harvard University
Center for International Development
DANI RODRIK
Harvard University
John F. Kennedy School of Government
Centre for Economic Policy Research (CEPR)
National Bureau of Economic Research (NBER)
Document: Available from the SSRN Electronic Paper Collection:
http://papers.ssrn.com/paper.taf?abstract_id=262173
Paper ID: KSG Working Paper No. 01-008
Date: February 2001
Contact: DANI RODRIK
Email: Mailto:dani_rodrik at harvard.edu
Postal: Harvard University
John F. Kennedy School of Government
79 John F. Kennedy Street
Cambridge, MA 02138 USA
Phone: (617) 495-9454
Fax: (617) 496-5747
Co-Auth: ETHAN KAPLAN
Email: Mailto:ekaplan at fas.harvard.edu
Postal: Harvard University
Center for International Development
One Eliot Street Building
79 JFK Street
Cambridge, MA 02138 USA
Paper Requests:
Contact Raquel Schott, Mailto:Raquel_Schott at ksg.harvard.edu
Postal: JFK School of Government, Harvard University, 79 John F.
Kennedy St., Cambridge, MA 02138. Phone:(617)495-5444.
Fax:(617)496-0001.
ABSTRACT:
Malaysia recovered from the Asian financial crisis swiftly after
the imposition of capital controls in September 1998. The fact
that Korea and Thailand recovered in parallel has been
interpreted as suggesting that capital controls did not play a
significant role in facilitating Malaysia's rebound. However,
the financial crisis was deepening in Malaysia in the summer of
1998, while it had significantly eased up in Korea and Thailand.
We employ a time-shifted differences-in-differences technique to
exploit the differences in the timing of the crises. Compared to
IMF programs, we find that the Malaysian policies produced
faster economic recovery, smaller declines in employment and
real wages, and more rapid turnaround in the stock market.
Keywords: Internation Economics, International Development