The Duration of Capital Account Crises—An Empirical Analysis
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Summary:
This paper examines the duration of capital account crises. We develop a new index to identify both the start and the end of these crises. Applying the index to a sample of 18 crisis episodes, we derive stylized facts on crisis duration and review the economic and financial circumstances that prevailed at the dusk of crises, a relatively unexplored area. We use the econometric technique of duration analysis to gauge the relative importance of various factors affecting the probability of exiting a crisis. We find that initial and external conditions are key determinants. But fiscal and monetary policies can also help shorten crisis duration.
Series:
Working Paper No. 2007/258
Subject:
Capital account crisis Capital flows Capital outflows Exchange rates Financial crises
English
Publication Date:
November 1, 2007
ISBN/ISSN:
9781451868210/1018-5941
Stock No:
WPIEA2007258
Pages:
42
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