Some positive consequences of the Global Economic Crisis
Author: Mario Lamberte, ADBI
Asia did not contribute to the global economic crisis (GEC) by saving too much but rather was an innocent bystander.
Now, addressing the GEC provides an opportunity to rethink Asia’s growth strategy and macroeconomic paradigms.
Origins of the crisis
There are two views about the causes of the crisis. One view suggests that the global imbalance was its major cause. There was a global ‘savings glut’, the source of which was Asia.
It is not clear ex ante whether the large current account imbalance between the US and the rest of the world can be attributed primarily to excess demand in the US or excess savings in the rest of the world.