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Indonesia’s Economic Crisis : Contagion and Fundamentals

Iriana, Reiny and Sjöholm, Fredrik LU (2002) In Developing Economies 40(2). p.135-151
Abstract
The severe and unanticipated economic downturn in Indonesia mirrored the regional economic fallout following the 1997 financial crisis. Although it is likely that the crisis in neighboring countries had an adverse impact on Indonesia, the issue has so far received little attention. This paper examines whether contagion from the economic crisis in Thailand triggered the crisis in Indonesia. Evidence of such a contagion is revealed, and the contagion was possibly exacerbated by increasing imbalances in the Indonesian economy. The paper also examines the channels through which the economic difficulties of Thailand might have been transmitted to Indonesia. Investors’behavior, rather than real links, is identified as one important channel for... (More)
The severe and unanticipated economic downturn in Indonesia mirrored the regional economic fallout following the 1997 financial crisis. Although it is likely that the crisis in neighboring countries had an adverse impact on Indonesia, the issue has so far received little attention. This paper examines whether contagion from the economic crisis in Thailand triggered the crisis in Indonesia. Evidence of such a contagion is revealed, and the contagion was possibly exacerbated by increasing imbalances in the Indonesian economy. The paper also examines the channels through which the economic difficulties of Thailand might have been transmitted to Indonesia. Investors’behavior, rather than real links, is identified as one important channel for the contagion. (Less)
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author
publishing date
type
Contribution to journal
publication status
published
subject
in
Developing Economies
volume
40
issue
2
pages
17 pages
publisher
Wiley-Blackwell
external identifiers
  • scopus:0036592571
ISSN
0012-1533
DOI
10.1111/j.1746-1049.2002.tb01004.x
language
English
LU publication?
no
id
49b6d0fa-eff8-4ce1-a205-06df994a0f51
date added to LUP
2017-10-10 17:43:49
date last changed
2017-10-15 04:55:55
@article{49b6d0fa-eff8-4ce1-a205-06df994a0f51,
  abstract     = {The severe and unanticipated economic downturn in Indonesia mirrored the regional economic fallout following the 1997 financial crisis. Although it is likely that the crisis in neighboring countries had an adverse impact on Indonesia, the issue has so far received little attention. This paper examines whether contagion from the economic crisis in Thailand triggered the crisis in Indonesia. Evidence of such a contagion is revealed, and the contagion was possibly exacerbated by increasing imbalances in the Indonesian economy. The paper also examines the channels through which the economic difficulties of Thailand might have been transmitted to Indonesia. Investors’behavior, rather than real links, is identified as one important channel for the contagion.},
  author       = {Iriana, Reiny and Sjöholm, Fredrik},
  issn         = {0012-1533},
  language     = {eng},
  number       = {2},
  pages        = {135--151},
  publisher    = {Wiley-Blackwell},
  series       = {Developing Economies},
  title        = {Indonesia’s Economic Crisis : Contagion and Fundamentals},
  url          = {http://dx.doi.org/10.1111/j.1746-1049.2002.tb01004.x},
  volume       = {40},
  year         = {2002},
}