| Abstract: | The article sets the Asian financial crisis in the context ofthe developmental state model of Asian development and seesit as, in part, the downside risk of a financial liberalizationthat was badly handled but nevertheless appropriate as a stimulusto better productivity performance. The East Asian economiesare shown still to have a large labour productivity gap withthe leading OECD countries and substantial scope for furtherrapid catch-up growth. Historical experience suggests that thepolicy response to the crisis is fundamental not only to immediaterecovery prospects but also to realizing this remaining fastgrowth potential. |
