THE ECONOMIC-CRISIS IN ASIA

This article sums up some of the main events of the economic downturn in Thailand, Malaysia, Indonesia and South Korea. With a well function ing bankruptcy mechanism, and with relatively greater reliance in smal l-scale businesses, Taiwan has benefited from more continuous 'creativ e destruction', along Schumpeterian lines. In order to return to a sus tainable growth path an acceptable distribution of the losses entailed by, e.g., falling assets prices, must be found. The experience of ban king crises in the US and Norway is of relevance here. In contrast to foreign banks' lending in Africa and Latin America the bulk of outstan ding loans in Asian countries is to private rather than public entitie s. This makes bail-out of foreign banks less likely.