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Financial Crises, Monetary Policy and Financial Fragility; A Second-Generation Model of Currency Crises

Eijffinger, Sylvester C W; Goderis, Benedikt - C.E.P.R. Discussion Papers - 2002

In this Paper we present a model that combines the second-generation trade-off between costs of maintenance and abandonment with possible balance-sheet problems in the corporate sector. We show how debt levels can move a small economy from a fixed exchange rate to a floating exchange rate...

Persistent link: https://www.econbiz.de/10005504385

Systemic Risk: A Survey

de Bandt, Olivier; Hartmann, Philipp - C.E.P.R. Discussion Papers - 2000

related payment and settlement systems. At the heart of systemic risk are contagion effects, various forms of external effects … rigorous models of bank and payment system contagion have now been developed, although a general theoretical paradigm is still … missing. Direct econometric tests of bank contagion effects seem to be mainly limited to the United States. Empirical studies …

Persistent link: https://www.econbiz.de/10005114152

Stories of the Twentieth Century for the Twenty-First

Gourinchas, Pierre-Olivier; Obstfeld, Maurice - C.E.P.R. Discussion Papers - 2011

reserves predict a sharply reduced probability of a subsequent crisis. …

Persistent link: https://www.econbiz.de/10009201122

On the Fiscal Implications of Twin Crises

Burnside, Craig; Eichenbaum, Martin; Rebelo, Sérgio - C.E.P.R. Discussion Papers - 2001

This Paper explores the implications of different strategies for financing the fiscal costs of twin crises in inflation and depreciation rates. We use a first-generation type model of speculative attacks which has four key features: (i) the crisis is triggered by prospective deficits: (ii) there...

Persistent link: https://www.econbiz.de/10005791885

Government Finance in the Wake of Currency Crises

Burnside, Craig; Eichenbaum, Martin; Rebelo, Sérgio - C.E.P.R. Discussion Papers - 2003

This Paper addresses two questions: (i) how do governments actually pay for the fiscal costs associated with currency crises; and (ii) what are the implications of different financing methods for post-crisis rates of inflation and depreciation? We study these questions using a general...

Persistent link: https://www.econbiz.de/10005791917

Prospective Deficits and the Asian Currency Crises

Burnside, Craig; Eichenbaum, Martin; Rebelo, Sérgio - C.E.P.R. Discussion Papers - 1998

This paper argues that the recent Southeast Asian currency crises was caused by large prospective deficits associated with implicit bailout guarantees to failing banking systems. We articulate this view using a simple dynamic general equilibrium model whose key feature is that a speculative...

Persistent link: https://www.econbiz.de/10005124184

Is There a Safe Passage to EMU? Evidence on Capital Controls and a Proposal

Eichengreen, Barry; Rose, Andrew K; Wyplosz, Charles - C.E.P.R. Discussion Papers - 1994

This paper provides evidence on the effects of capital controls. We show that controls have been associated with significant differences in macroeconomic behaviour, especially in monetary policy. While they have not prevented speculative attacks, they have provided the breathing space needed to...

Persistent link: https://www.econbiz.de/10005067603

Coordination, Cooperation, Contagion and Currency Crises

Loisel, Olivier; Martin, Philippe - C.E.P.R. Discussion Papers - 1999

improving, makes countries more dependent on other countries' fundamentals so that it may induce more contagion: a negative …

Persistent link: https://www.econbiz.de/10005124321

Mixed Signals in Defending the Exchange Rate: What do the Data Say?

Drazen, Allan; Hubrich, Stefan - C.E.P.R. Discussion Papers - 2003

High interest rates to defend the exchange rate signal that a government is committed to fixed exchange rates, but may also signal weak fundamentals. We test the effectiveness of the interest rate defense by disaggregating into the effects on future interest rates differentials, expectations of...

Persistent link: https://www.econbiz.de/10005789209

Understanding Financial Crises: Causes, Consequences, and Policy Responses

Claessens, Stijn; Kose, Ayhan; Laeven, Luc; Valencia, Fabian - C.E.P.R. Discussion Papers - 2013

The global financial crisis of 2007-09 has led to an intensive research program analyzing a wide range of issues related to financial crises. This paper presents a summary of a forthcoming book, Financial Crises: Causes, Consequences, and Policy Responses, that includes 19 contributions...

Persistent link: https://www.econbiz.de/10011083226