Advanced Search
MyIDEAS: Login to save this paper or follow this series

Economic Fundamentals and Self-Fulfilling Crises: Some Evidence from Mexico

Contents:

Author Info

  • G J Bratsiotis
  • W Robinson

Abstract

This paper considers a model of debt stabilitisation under a fixed exchange rate in which a currency crisis can develop as the result of self-fulfilling speculation, following a bifurcation in the behaviour of economic fundamentals. Based on this theoretical framework and by exploiting the test developed by Jeanne (1997), this paper provides evidence that self-fulfilling speculation was at work in the 1994 Mexican crisis. In terms of fundamentals, we show that the critical variables in generating the Mexican crisis were the fast rise in the US$-denominated public debt (tesebonos), the appreciated real exchange rate and the small rises in unemployment and primary deficit.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.socialsciences.manchester.ac.uk/medialibrary/cgbcr/discussionpapers/dpcgbcr23.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Economics, The Univeristy of Manchester in its series Centre for Growth and Business Cycle Research Discussion Paper Series with number 23.

as in new window
Length: 33 pages
Date of creation: 2002
Date of revision:
Handle: RePEc:man:cgbcrp:23

Contact details of provider:
Postal: Manchester M13 9PL
Phone: (0)161 275 4868
Fax: (0)161 275 4812
Web page: http://www.socialsciences.manchester.ac.uk/subjects/economics/our-research/centre-for-growth-and-business-cycle-research/
More information through EDIRC

Related research

Keywords: currency crisis; speculation; multiple equilibria; 1994 Mexican crisis;

Other versions of this item:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:man:cgbcrp:23. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marianne Sensier).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.