1IntroductionPrior to the July 1997 baht collapse that triggered the Asian currency crisis, Thailands economy experienced sustained and notable growth.The government and the Bank of Thailand implemented low interest rates and capital liberalization policies, which attracted substantial foreign capital inflows after 1987, including from Japanese companies facing a strong yen.Real estate prices in Bangkok surged dramatically, and stock prices reached new heights.Between 1987 and 1995, the economy exhibited clear signs of a bubble.Figure 1 illustrates the stock market trend, with the SET Index peaking in 1993.As noted by Radelet and Sachs (1998), Thailands economic cycle also reflected periods of boom and bust.
Takayuki Yamashita (Sun,) studied this question.