The Asian model: a crisis foretold

Abstract The East Asian countries achieved extraordinarily fast economic growth during the last four decades. Indeed, it would be no exaggeration to say that they represented the most successful case of rapid industrialisation and sustained economic growth in the history of mankind. This paper argues that the influential thesis of the US government and the IMF are the fundamental causes of the Asian financial crisis lie in the dirigiste model of guided capitalism followed by these countries is seriously mistaken. The crisis has arisen in large measure by precipitate financial liberalisation which involved the abandonment of the essential tenets of the model.