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Banking Crises in Emerging Markets: Presumptions and Evidence

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  • Barry Eichengreen and Carlos Arteta.

Abstract

JEL Classification: E44, G21 Keywords: banking sector, banking crises, emerging markets The existing empirical literature on banking crises has not produced agreement on their causes. Using a sample of 75 emerging markets in 1975-1997, we attempt to determine what we know about banking crises by establishing which previous results are robust. Among the robust causes of emerging-market banking crises are rapid domestic credit growth, large bank liabilities relative to reserves, and deposit-rate decontrol. On the other hand, there is no compelling evidence of any particular relationship between exchange rate regimes and crises. Finally, the evidence that deposit insurance or a weak institutional environment heighten crisis risk appears to be fragile

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Bibliographic Info

Paper provided by University of California at Berkeley in its series Center for International and Development Economics Research (CIDER) Working Papers with number C00-115.

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Date of creation: 01 Aug 2000
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Handle: RePEc:ucb:calbcd:c00-115

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