Detail Currency crises in developed and emerging market economies: A comparative empirical treatment Bibliografi Author: Fontaine, Thomson ; Dougan, William (Advisor) Topik: ECONOMICS; GENERAL Bahasa: (EN )    ISBN: 0-599-82798-X     Penerbit: CLEMSON UNIVERSITY     Tahun Terbit: 1999     Jenis: Theses - Dissertation Fulltext: 9976921.pdf (0.0B; 0 download) Abstract There are a number of theoretical models that attempts to highlight the dynamics behind currency crises. Fundamental to these models is why country authorities either by their own choosing or through unavoidable events are forced to abandon the exchange rate regime. Some models range from an emphasis on bad fundamentals to the role of speculative agents in precipitating a currency crisis. Others focus attention on the role that political influences play in making it difficult to successfully defend the exchange rate regime. Yet others stress the role of contagion in affecting otherwise solid currency arrangements. In this paper, I have taken a step in empirically testing the implications of those models. By focusing on a broad range of countries with varying economic and political situations, I have attempted to determine the extent to which these variables matter in affecting the probabilities of currency crises occurring. An important distinguishing feature of this paper is the attempt made in comparing the incidence of currency crises across two disparate economic and political arrangements—namely Developed and Emerging Market economies. While no attempt is made to empirically explicitly differentiate between first and second-generation models, the paper finds compelling evidence that both of these theoretical underpinnings are borne out by the available evidence. The empirical findings provide support for the view that, in general, the deterioration in economic fundamentals and the pursuit of lax monetary policy can contribute to currency crises. Also, unfavorable political factors and currency crises elsewhere in the world could all contribute. The effect of some of the variables that contribute toward currency crises are more pronounced in Emerging market economies. In particular, during the period 1960–1997, the growth rate of domestic credit, the rate of inflation, and the growth rate of money all played a more significant role in emerging market economies more so than in Developed economies in determining currency crises. Also during that period, low output growth, the current account deficit and the budget deficit generated high probabilities for the recorded crises periods. The experience of several emerging market economies suggest that the sustainability of exchange rate policy depends both on adequate policy responses to the shocks to the economy and on the extent of fragility of the economic and financial system as well as the political system. The paper found support for the view that a strong domestic financial system coupled with consistent fiscal and monetary policies are key to the sustainability of any exchange rate regime. The experience of several emerging market economies suggest that the sustainability of exchange rate policy depends both on adequate policy responses to the shocks to the economy and on the extent of fragility of the economic and financial system as well as the political system. Although no effort was made to determine how currency crises were transmitted from one country to another, the paper however, established the existence of contagion within foreign exchange markets. The existence of a currency crisis in one country was shown to contribute to the probability of a domestic currency crisis by about 14 percentage points. This effect also persisted with a lag of up to four years. Opini Anda Klik untuk menuliskan opini Anda tentang koleksi ini! Lihat Sejarah Pengadaan  Konversi Metadata   Kembali

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