Currency and Banking Crises: The Early Warnings of Distress
Electronic Access:
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Summary:
The abruptness and virulence of the 1997 Asian crises have led many to claim that these crises are of a new breed and were thus unforecastable. This paper examines 102 financial crises in 20 countries and concludes that the Asian crises are not of a new variety. Overall, the 1997 Asian crises, as well as previous crises elsewhere, occur when economies are in distress, making the degree of fragility of the economy a useful indicator of future crises. Based on this idea, the paper proposes different composite leading indicators of crises, evaluated in terms of accuracy both in-sample and out-of-sample.
Series:
Working Paper No. 1999/178
Subject:
Banking Banking crises Currency crises Cyclical indicators Economic growth Financial crises Foreign exchange Real exchange rates
English
Publication Date:
December 1, 1999
ISBN/ISSN:
9781451858938/1018-5941
Stock No:
WPIEA1781999
Pages:
38
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