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Dealing with bank system failure: Indonesia, 1997-2003

McLeod, Ross

Description

Indonesia's crisis recovery program has failed badly in relation to the two key objectives of development economics policy making: efficiency and equity. The economy went into severe recession within a few months of the IMF appearing on the scene, and six years later output was little higher than before the crisis. The collapse of the banking system and the associated government bailout of depositors has imposed a loss on the public of at least 40% of GDP. This paper describes that collapse and...[Show more]

dc.contributor.authorMcLeod, Ross
dc.date.accessioned2015-12-13T23:09:15Z
dc.identifier.issn0007-4918
dc.identifier.urihttp://hdl.handle.net/1885/86913
dc.description.abstractIndonesia's crisis recovery program has failed badly in relation to the two key objectives of development economics policy making: efficiency and equity. The economy went into severe recession within a few months of the IMF appearing on the scene, and six years later output was little higher than before the crisis. The collapse of the banking system and the associated government bailout of depositors has imposed a loss on the public of at least 40% of GDP. This paper describes that collapse and the government's policy response to it, under advice from the IMF. It goes on to propose an alternative scheme that might have been followed-and that could be followed in future banking crises. Its twin objectives are to maintain the integrity of the payments system and to avoid inequitable wealth transfers that result from government bailouts of banks and their depositors.
dc.publisherRoutledge, Taylor & Francis Group
dc.sourceBulletin of Indonesian Economic Studies
dc.subjectKeywords: banking; crisis management; financial crisis; financial market; Asia; Eurasia; Indonesia; Southeast Asia
dc.titleDealing with bank system failure: Indonesia, 1997-2003
dc.typeJournal article
local.description.notesImported from ARIES
local.description.refereedYes
local.identifier.citationvolume40
dc.date.issued2004
local.identifier.absfor140207 - Financial Economics
local.identifier.absfor140212 - Macroeconomics (incl. Monetary and Fiscal Theory)
local.identifier.ariespublicationMigratedxPub15969
local.type.statusPublished Version
local.contributor.affiliationMcLeod, Ross, College of Asia and the Pacific, ANU
local.description.embargo2037-12-31
local.bibliographicCitation.issue1
local.bibliographicCitation.startpage95
local.bibliographicCitation.lastpage116
local.identifier.doi10.1080/0007491042000205222
dc.date.updated2015-12-12T08:18:20Z
local.identifier.scopusID2-s2.0-1842637804
CollectionsANU Research Publications

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