There are two major failings in policy interventions in the crisis in the US and Europe: the reluctance to remove the debt overhang through timely, orderly and comprehensive restructuring and the shift to fiscal austerity after an initial reflation. These have resulted in excessive reliance on...

The global economic crisis has revealed that growth in East Asia is highly vulnerable to slowdown in exports to major advanced economies. This paper shows that in precrisis years, at least one third of growth in the Peoples Republic of China was due to exports, and this proportion was even...