We show theoretically and empirically that twin currency and debt crises should be treated as a particular crisis type. Twin currency and debt crises differ from both pure currency and pure debt crises in their determinants, the course of the crises, and their economic consequences. We find that...

Empirically, currency crises are more frequently accompanied by simultaneous sovereign debt crises than by banking crises. Nevertheless the phenomenon of twin currency and debt crises has so far been treated in economic literature only sparsely. We analyse the optimal policy of a government that...

While the well-known twin currency and banking crises has drawn a lot of interest a second type of twin crises, the simultaneous occurrence of currency and debt crises, has so far been neglected in the literature. The decision of a government to devalue and/or to default is closely interlinked...

Though currency and debt crises quite often occur simultaneously, the links between these two types of crises are not well understood. We review how currency and debt crises could be related due to (1) common causes, (2) internal contagion effects from one crisis to the other, and (3)...