Crisis and Recovery in Malaysia. The Role of Capital Controls - Prema-chandra Athukorala

The prime focus of the book is on Malaysia's radical policy decision to pursue an independent recovery path, cut off from world markets by a system of capital control, as a viable alternative to the conventional market centred approach. The analysis suggests that, against the initial dire predictions of many economists, the capital controls have actually played a crucial supportive role in crisis management. Whether the controls have played a special role in delivering a superior recovery outcome in Malaysia compared to IMF-program countries remains a point of contention. However, there is strong evidence to suggest that this pragmatic policy choice was instrumental in achieving recovery, while minimising potential economic disruption and related social costs.

The book provides an integrated view of the modalities and working of the capital-control based recovery package in the context of a comprehensive survey of macroeconomic management in Malaysia and from a comparative East Asian perspective. It will prove to be of great value to development macroeconomists, monetary and financial economists and students of Malaysian and East Asian development.