The political economy of the Thai crisis

Abstract

This paper looks at the background to Thailand's crisis of 1997 from the viewpoint of the local political economy. The policy regime which had managed stable growth before 1985 was destroyed by a coalition of newly empowered technocrats, new business groups, and the neoliberal World Bank/IMF. This coalition promoted financial liberalization, but had neither the ideological coherence nor the political power to manage the consequences. The neoliberal enthusiasm for free markets, especially in finance, is based on a naive view of political realities and of the relationship between politics and business.

Keywords:

• Thailand
• economy
• crisis
• finance
• Asia
• politics