Regional Financial Integration in East Asia Challenges and Prospects

• Published in: Regional Financial Cooperation p. 227
• Main Author: YUNG CHUL PARK
• Format: Book Chapter
• Language: English
• Published: United States Brookings Institution Press and Economic Commission for Latin America and the Caribbean (ECLAC) 29-08-2007; Brookings Institution Press
• Subjects: Countries; Economic conditions; Economic crises; Economic disciplines; Economics; Exchange rates; Financial economics; Financial markets; Foreign exchange; Government; Government agencies; Human geography; Intelligence services; International cooperation; International economic cooperation; International economic organizations; International economics; International finance; International financial institutions; International political organizations; International politics; International relations; International trade; Macroeconomics; Political geography; Political integration; Political organizations; Political processes; Political science; Politics; Regional cooperation; Social sciences; Surveillance; Trade regionalization
• ISBN: 9780815764199; 0815764197

The large currency crises of the past decade have been regional in nature.¹ This feature of financial crises suggests that neighboring countries have a strong incentive to engage in mutual surveillance and to extend financial assistance to one another in the face of potentially contagious threats to stability. Regardless of whether the sudden shifts in market expectations and confidence were the primary source of the Asian financial crisis, foreign lenders were so alarmed by the Thai crisis that they abruptly pulled their investments out of the other countries in the region, making the crisis contagious. The geographic proximity and economic