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Are twin currency and debt crises special?

Title data

Bauer, Christian ; Herz, Bernhard ; Karb, Volker:
Are twin currency and debt crises special?
In: Journal of Financial Stability. Vol. 3 (April 2007) Issue 1 . - pp. 59-84.
ISSN 1572-3089
DOI: https://doi.org/10.1016/j.jfs.2007.03.002

Abstract in another language

In the literature on currency and banking crises it has become the standard procedure to distinguish pure currency crises, pure banking crises and combined (“twin”) currency and banking crises. We show theoretically and empirically that a similar differentiation should be chosen with regard to currency and debt crises. Twin currency and debt crises differ from both pure currency and pure debt crises in their determinants, course of events, and economic consequences. We find that each type of crises has a unique set of macroeconomic causes. We also identify internal contagion and selection bias effects, which may lead to biased empirical estimates if twin crises are not treated as a specific type of crises. Such a separation allows in significantly improving the efficiency of early warning systems especially for debt and twin crises.

Further data

Item Type: Article in a journal
Refereed: Yes
Keywords: Currency crises; Debt crises; Twin crises; Emerging markets
Subject classification: JEL classification: F31; F33; F34; F41
Institutions of the University: Faculties
Faculties > Faculty of Law, Business and Economics
Faculties > Faculty of Law, Business and Economics > Department of Economics
Faculties > Faculty of Law, Business and Economics > Department of Economics > Chair Economics I
Faculties > Faculty of Law, Business and Economics > Department of Economics > Chair Economics I > Chair Economics I - Univ.-Prof. Dr. Bernhard Herz
Result of work at the UBT: Yes
DDC Subjects: 300 Social sciences > 330 Economics
Date Deposited: 30 Nov 2017 08:12
Last Modified: 30 Nov 2017 08:12
URI: https://eref.uni-bayreuth.de/id/eprint/40599