The paper explores the nature of macroeconomic interdependence in post-crisis Asia. Empirical
evidence suggests that, relative to the pre-crisis period, output and price correlations in Asia have
increased and the output and price impacts of shocks originating within the region have risen. This
greater interdependence, however, did not come at the expense of a weaker economic tie with the rest
of the world (as clearly demonstrated in the recent global economic crisis). Asian policymakers must
better manage the region’s growing macroeconomic linkages through greater cooperation — both to
mitigate the impact of negative policy spillovers and to foster an environment in which regional and
global links can continue to deepen.