NBER Reporter: Winter 2000/2001

Economic and Financial Crises in Emerging Market Economies

As part of the NBER's Project on Economic and Financial Crises in Emerging Market Economies, NBER President Martin Feldstein organized a conference that brought together a group of distinguished individuals from the United States and other countries who have been key participants in the resolution of such crises. On October 20 and 21 in Woodstock, Vermont, they convened to discuss their experiences and share their thoughts.

The motivation for the discussion was provided by six background papers covering different aspects of the prevention and management of the crises. These papers, currently available at Books in Progress, by topic and author are:

Exchange Rate Regimes -- Sebastian Edwards, NBER and University of California at Los Angeles

Financial Policies -- Frederic Mishkin, NBER and Columbia University

Industrial Country Policies -- Jeffrey Frankel, NBER and Harvard University, and Nouriel Roubini, NBER and New York University

IMF Stabilization Programs -- Anne O. Krueger, NBER and Stanford University

IMF Structural Programs -- Morris Goldstein, Institute for international Economics

Creditor Relations -- William Cline, Institute of International Finance

The conference itself was organized into six sessions, which dealt with these topics. Each session began with prepared remarks by three individuals who have been government or private sector participants in the crisis management or have had key positions in affected countries. Some of the current and former U.S. officials who spoke at the conference were: former U.S. Treasury Secretary Robert Rubin; current U.S. Treasury Secretary Lawrence Summers; and former Chairman of the Federal Reserve Board of Governors Paul Volcker.

The international financial agencies were represented at the conference by, among others, Andrew Crockett, General Manager of the Bank for International Settlements; Stanley Fischer, First Deputy Managing Director of the IMF; and Nicholas Stern, Chief Economist of The World Bank.

The current and former officials of foreign nations included: Montek Singh Ahluwalia, Chairman of India's Planning Commission and former chief economist for the Indian government; Domingo F. Cavallo, former Minister of Finance of Argentina; Arminio Fraga, Governor of the Central Bank of Brazil; Jacob Frenkel, former Governor of the Bank of Israel and former Chief Economist of the International Monetary Fund; Paul Keating, former Finance Minister and Prime Minister of Australia; Mervyn King, Deputy Governor of the Bank of England; and Guillermo Ortiz, Governor of the Bank of Mexico.

Among those who participated coming from private financial institutions were: E. Gerald Corrigan, Goldman Sachs and Co.; John Crow, J&R Crown, Inc.; David Lipton, Moore Capital Strategy Group; Roberto Mendoza, Goldman Sachs International; George Soros, Soros Fund Management; and Lin See Yan, LIN Associates.

Other participants included: Caroline Atkinson, Timothy Geithner, and Edwin Truman of the U.S. Treasury Department; Jack Boorman, International Monetary Fund; Charles Dallara, Institute of International Finance; Peter Garber, Deutsche Bank; Takatoshi Ito, Ministry of Finance, Japan; Karen Johnson, Federal Reserve Board of Governors; Paul Krugman, NBER and Princeton University; John Langlois, Center for International Political Economy; John McHale, Harvard University; Manuel Montes, The Ford Foundation; Yung Chul Park, Korea University; Jeffrey Sachs, NBER and Harvard University; Ammar Siamwalla, Thailand Development Research Institute; and Martin Wolf, The Financial Times.

A summary of the conference discussion as well as the 17 formal remarks and the background papers will appear in a University of Chicago Press volume edited by Feldstein. Prior to its publication, these papers and a summary of the discussion are available on the NBER's web site under Books in Progress.

This conference was part of a larger project organized jointly by Feldstein and Frankel. In the future as part of that project, there will be scientific conferences on "Reducing the Risk of Currency Crises," organized by Frankel and Edwards, and "Managing Currency Crises," organized by Frankel and Dooley. Five one-day meetings over the last few years have looked at developments in specific countries: Mexico, Thailand, Korea, Indonesia, and Brazil. The project is supported by the Ford Foundation, the Mellon Foundation, and the Center for International Political Economy.

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