Economic Crisis

Malaysia in the Global Economy
Daniel E. Charette

Crisis, Recovery, and the Road Ahead

This article offers an analysis of modern economic development in Malaysia, tapering especially on the causes and consequences of the 1997 Asian Financial Crisis. Malaysia offers an excellent case study in international development due to its role as an export-dependent create country with a high degree of integration in the world(a) economy. In attempting to determine why Malaysia was enveloped by a financial crisis in July of 1997, a two-level political economy near is used to separate international insurance policy influences from domestic influences. My findings conjure up that a combination of ill-advised, full jacket account rest (Washington Consensus / international influence) combined with im judicious handling of massive short-term capital inflows (domestic) in the late 1980s and 1990s take to a currency devaluation that resulted in a financial crisis and, consequently, a crisis of Malaysias real economy. This study identifies three specific policy choices made by the Malaysian government as submissive in creating crisis-prone conditions: a fixed exchange rate, an open capital account, and monetary policy autonomy.



Among foreign and domestic investors, this policy political science created a false sense of confidence in the stability of Malaysias economy. Since the crisis, Malaysian policymakers have come to recognize that a developing countrys vulnerability in the sometimes-volatile global economy cannot be completely eliminated. Under its current leadership, Malaysia has wisely sought to lessen its vulnerability through confidence-building measures in the banking and corporal sectors, diversification of the domestic economy through a focus on commodity and service expansion, and the implementation of more prudent macroeconomic policies. This line of research is valuable as it highlights the unequivocal virtues and dangers of a developing countrys economic...If you want to go far a full essay, order it on our website: Orderessay



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