This paper examines how devaluations affect the relative costs of labor and capital and therefore influence production, profitability, investment, and stock returns for firms in the "crisis" country as well as competitors in the rest of the world. After developing these ideas in a small,...

This paper examines how 12 "major depreciations" between 1997 and 2000 affected different measures of firm performance in a sample of over 13,500 companies from around the world. Results suggest that in the year after depreciations, firms have significantly higher growth in market...

Countries choose different strategies when responding to crises. It is challenging to assess the impact of these policy choices on key variables, however, because of endogeneity and selection bias. This paper addresses these challenges by using propensity-score matching to estimate how major...