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BPEA Article

The East Asian Financial Crisis: Diagnosis, Remedies, Prospects

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Abstract

"HISTORY," JAWAHARLAL NEHRU famously observed, "is almost always written by the victors. " Financial history, it seems, is written by the creditors. When a financial crisis arises, it is the debtors who are asked to take the blame. This is odd, since a loan agreement invariably has two parties. The failure of a loan usually represents miscalculations on both sides of the transaction or distortions in the lending process itself.

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