Small open economies traditionally do not consider exchange rates explicitly when targeting inflation. However, the models used rely on various assumptions. To investigate this, we developed a small-scale, structural general equilibrium model for the Thai economy. Using Bayesian estimation, we...

This thesis documents the stylized facts of the business cycle in Thailand and analyzes the ability of real business cycle models to capture these facts. The models are solved by the method of finding a linear approximation to the first order condition proposed by King, Plosser and Rebelo...

Was the East Asian crisis just a creditor panic with a mad scramble for liquidity that brought the banking system to its knees and the region's much-vaunted 'economic miracle' to a standstill? Or was the miracle indeed flawed by fundamental problems in asset prices and resource allocation? After...

Credit market imperfections have been blamed for the depth and persistence of the Great Depression in the USA. Could similar mechanisms have played a role in ending the East Asian miracle? After a brief account of the nature of the recent crisis, we use a model of highly levered...

The first part of this thesis examines the role of highly-leveraged institution in creating vulnerability in the financial system. By applying the framework of Kiyotaki and Moore (1997), Chapter 2 shows that when an asset price bubble bursts which cuts the value of land being used as collateral,...