THE BROOKINGS PANEL on Economic Activity held its sixty-sixth
conference in Washington, D.C., on September 3 and 4, 1998. This
issue of Brookings Papers includes the papers, reports, and discussions
presented at the conference. The first paper analyzes the East Asian
currency crisis, examining its predictability and causes, and evaluating
the policy responses that were made. The second provides a modern
version of the Keynesian liquidity trap as an explanation of Japan's
deepening recession and offers an unorthodox policy prescription:
promised inflation. The third paper examines the roles played by demographics
and tropical geography in perpetuating poverty in Africa.
The first report reviews the performance of conventional models of
inflation during the recent period of outstanding macroeconomic performance
in the U.S. economy. And the concluding report examines
Japan's current banking problem, tracing its origins to the postwar
evolution of the Japanese economic and financial systems.