Krugman: Asia was impressive but still human
??MIT Economics Professor Paul Krugman wrote an article "TheMyth of Asia's Miracle" published in Foreign Affairs in 1994. In that article, he denounced the Asian miracle and believed that Asia's growth could not be sustained. During his visit to Singapore last month, he talked about the current Asian economic crisis and suggested some radical measures. The following is an abstract of his interview withBusiness Times.??Q: In your 'Foreign Affairs' article, you argued that Asia's growth could be basically explained by high rates of investment. But how did that growth manage to be sustained for so long --close on 30 years???A: There were three things going on. The first was high rates of investment. The second was high rates of labour force growth. Finally, you had increases in education levels. So if you took into account those triple sources of growth, which were all measurable inputs, they somewhat surprisingly seemed to explain pretty much all of what had happened in Asia. There's nothing paradoxical about that: the mobilisation of resources was immense.??Q: What were the earliest signs of things being wrong???A: The stuff I talked about in 1994 wasn't a sign of an impending crisis -- at least I didn't think so. But I suppose you could look at the indicators there and say therewere signs there that Asia's growth at that pace was not sustainable.??The first I began to see that some kind of crisis might bein the offing was some time in 1995 or early 1996, when I began to notice how similar the balance of payments developments were in South-east Asia to those in Latin America a couple of years before.??Like a lot of people, I saw the very large current accountdeficits and the buildup of short-term debt and I thought: this looks awfully like Mexico and Argentina in 1993-94. Andsince I had already decided on the basis of my earlier work that Asia was impressive but still human and subject to the normal limitations that affect other countries, I began saying: Gosh, there could be a currency crisis here. But I never imagined that anything like what has happened could happen.??Looking back, I think we didn't pay enough attention to the Mexican crisis of 1995. It was over relatively quickly, the rescue plan worked and we all kind of filed it away as just a blip -- a horrific blip, but still a blip. We really should have looked at it more closely because it was an indication that a new kind of economic crisis might be possible -- one that did not involve irresponsible monetary or fiscal policies and yet led to all hell breaking loose.??Q: Why didn't the approach that worked in Mexico work in Asia???A: One reason was that Mexico was extremely fortunate, notjust to have the US as a neighbour, but to have the US experi【Krugman: Asia was impressive but still human】相关文章：