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Anatomy of a Twin Crisis Author info | Abstract | Publisher info | Download info | Related research | Statistics Raphael H. Solomon
The author presents a model of a twin crisis, in which foreign and domestic residents play a banking game. Both "honest" and run equilibria of the post-deposit subgame exist; some run equilibria lead to a currency crisis, as agents convert domestic currency to foreign currency. In the subgame, sunspot variables can affect the equilibrium. The author calculates the unique equilibrium of the game numerically, taking into account the possible realizations of the sunspot variables. He also calibrates the model to the Turkish economy, providing insight into the Turkish twin crisis of 2001.
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Paper provided by Bank of Canada in its series Working Papers with number
03-41.
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Length: 44 pages
Date of creation: 2003Date of revision:
Handle: RePEc:bca:bocawp:03-41Contact details of provider: Postal: 234 Wellington Street, Ottawa, Ontario, K1A 0G9, Canada Phone: 613 782-8899 Fax: 613 782-8874 Web page: http://www.bank-banque-canada.ca/
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Keywords: Find related papers by JEL classification: E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies F30 - International Economics - - International Finance - - - General G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Mortgages
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Chao Gu, 2007.
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