Foreword by Donald J. Puchala, Ph.D. This book considers how a
financial crisis develops and how a government responds to a
financial crisis. In an attempt to shed light on these questions,
it closely examines two cases: Mexico during the Mexican Peso
Crisis of 1994 to 1995 and Malaysia during the Asian Financial
Crisis of 1997 to 1998. Sumer argues that economic explanations of
financial crises fail to fully answer these questions since they do
not pay enough attention to non-economic factors stemming from a
county's political, societal, institutional and external contexts.
The examination of the Mexico and Malaysia cases illustrates this
argument and shows that multiple non-economic factors-domestic
political, societal, institutional, psychological, and ideological
factors as well as external influences and pressures-can play roles
as significant as economic factors. Interplay of these non-economic
factors with economic ones brought these financial crises and
shaped the Mexican and the Malaysian governments' policy behaviors.
General
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