This paper introduces a framework for analyzing the role of financial factors as a source of instability in small open economies. Our basic model is a dynamic open economy model with a tradeable good produced with capital and a country-specific factor. We also assume that firms face credit...

The current financial sector of Vietnam nowadays has the same problems as Korean case after the financial crisis 1997. These problems are: high non-performing loans ratio (about 6-7%), low capital adequation ratio (less than 7%), lack of transparency, etc. But Korea had a good deal with these...

This paper introduces a framework for analyzing the role of financial factors as a source of instability in small open economies. Our basic model is a dynamic open economy model with a tradeable good produced with capital and a country-specific factor. We also assume that firms face credit...