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

External constraint and financial crises with balance sheet effects

Contents:

Author Info

  • Meixing DAI

Abstract

This paper examines a model of financial and exchange crises with balance-sheet effects by explicitly taking account of wealth accumulation and external equilibrium condition. We have found that, in a general equilibrium analysis, there are two stationary equilibria. Since foreign debt is always zero at these equilibria, financial crises in emerging market economies cannot be interpreted as jumps between equilibria but between trajectories leading to one equilibrium or another one. The mechanisms of financial crises due to monsoon or spill-over effects are also analysed in this framework.

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.beta-umr7522.fr/productions/publications/2009/2009-02.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg in its series Working Papers of BETA with number 2009-02.

as in new window
Length:
Date of creation: 2009
Date of revision:
Handle: RePEc:ulp:sbbeta:2009-02

Contact details of provider:
Postal: PEGE. 61, Aven. de la Forêt-Noire 67000 Strasbourg
Phone: +33 3 68 85 20 69
Fax: +33 3 68 85 20 70
Email:
Web page: http://www.beta-umr7522.fr/
More information through EDIRC

Related research

Keywords: Financial crisis; exchange crisis; balance sheet effect; external solvency constraint.;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. Banerjee, Abhijit & Bacchetta, Philippe & Aghion, Philippe, 2001. "Currency Crises and Monetary Policy in an Economy with Credit Constraints," Scholarly Articles 4554218, Harvard University Department of Economics.
  2. Enrique G. Mendoza, 2002. "Credit, Prices, and Crashes: Business Cycles with a Sudden Stop," NBER Chapters, National Bureau of Economic Research, Inc, in: Preventing Currency Crises in Emerging Markets, pages 335-392 National Bureau of Economic Research, Inc.
  3. Dai, Meixing & Sidiropoulos, Moïse, 2010. "Monetary and fiscal policy interactions with central bank transparency and public investment," MPRA Paper 23704, University Library of Munich, Germany.
  4. Barry Eichengreen & Ricardo Hausmann, 1999. "Exchange rates and financial fragility," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, Federal Reserve Bank of Kansas City, pages 329-368.
  5. Yong Jin Kim & Jong-Wha Lee, 1999. "Overinvestment, Collateral Lending, and Economic Crisis," CID Working Papers, Center for International Development at Harvard University 4, Center for International Development at Harvard University.
  6. Jeffrey Sachs & Aaron Tornell & Andres Velasco, 1996. "The Mexican Peso Crisis: Sudden Death or Death Foretold?," NBER Working Papers 5563, National Bureau of Economic Research, Inc.
  7. Johanna Etner & Sandrine Spaeter, 2010. "The impact of ambiguity on health prevention and insurance," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-08, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  8. Christophe J. Godlewski & Bulat Sanditov & Thierry Burger-Helmchen, 2010. "Bank lending networks, experience, reputation, and borrowing costs," Working Papers of LaRGE Research Center, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg 2010-07, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg.
  9. Jin Cheng, 2012. "Monnaie et crise bancaire dans une petite économie ouverte," Recherches économiques de Louvain, De Boeck Université, De Boeck Université, vol. 78(1), pages 47-73.
  10. Schmitt-Grohé, Stephanie & Uribe, Martín, 2002. "Closing Small Open Economy Models," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3096, C.E.P.R. Discussion Papers.
  11. Ben Bernanke & Mark Gertler & Simon Gilchrist, 1998. "The Financial Accelerator in a Quantitative Business Cycle Framework," NBER Working Papers 6455, National Bureau of Economic Research, Inc.
  12. Corsetti, Giancarlo & Pesenti, Paolo & Roubini, Nouriel, 1999. "Paper tigers?: A model of the Asian crisis," European Economic Review, Elsevier, Elsevier, vol. 43(7), pages 1211-1236, June.
  13. Baeriswyl, Romain & Cornand, Camille, 2010. "The signaling role of policy actions," Journal of Monetary Economics, Elsevier, Elsevier, vol. 57(6), pages 682-695, September.
  14. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, Federal Reserve Bank of Minneapolis, issue Win, pages 14-23.
  15. Bordo, Michael D. & Meissner, Christopher M. & Stuckler, David, 2010. "Foreign currency debt, financial crises and economic growth: A long-run view," Journal of International Money and Finance, Elsevier, Elsevier, vol. 29(4), pages 642-665, June.
  16. Aghion, Philippe & Bacchetta, Philippe & Banerjee, Abhijit, 2001. "A Corporate Balance Sheet Approach to Currency Crises," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3092, C.E.P.R. Discussion Papers.
  17. Hussler Caroline & Pénin Julien, 2010. "The determinants of scientific research agenda: Why do academic inventors choose to perform patentable versus non-patentable research?," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-06, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  18. Meixing Dai & Moïse Sidiropoulos & Eleftherios Spyromitros, 2014. "Fiscal policy, institutional quality and central bank transparency," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2014-04, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  19. Roberto Chang & Andres Velasco, 1998. "Financial Crises in Emerging Markets," NBER Working Papers 6606, National Bureau of Economic Research, Inc.
  20. Muge Ozman, 2010. "The Joint Effect of Technological Distance and Market Distance on Strategic Alliances," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-22, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  21. Kim, Yoonbai & Ying, Yung-Hsiang, 2007. "An empirical assessment of currency devaluation in East Asian countries," Journal of International Money and Finance, Elsevier, Elsevier, vol. 26(2), pages 265-283, March.
  22. Patrick Llerena & Muge Ozman, 2010. "Networks, Irreversibility and Knowledge Creation," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-10, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  23. Sirtaine, Sophie & Skamnelos, Ilias, 2007. "Credit growth in emerging Europe : a cause for stability concerns?," Policy Research Working Paper Series, The World Bank 4281, The World Bank.
  24. Roberto Chang & Andrés Velasco, 2001. "A Model Of Financial Crises In Emerging Markets," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 116(2), pages 489-517, May.
  25. Philippe Cordazzo & Magali Jaoul-Grammare, 2010. "Analyse multidimensionnelle de l’insertion professionnelle des étudiants de bac+5 : approche par les parcours de formation et le capital social," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-20, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  26. Philippe Aghion & Philippe Bacchetta & Abhijit Banerjee, 2004. "Financial Development and the Instability of Open Economies," NBER Working Papers 10246, National Bureau of Economic Research, Inc.
  27. Cook, David, 2004. "Monetary policy in emerging markets: Can liability dollarization explain contractionary devaluations?," Journal of Monetary Economics, Elsevier, Elsevier, vol. 51(6), pages 1155-1181, September.
  28. Jurgen Von Hagen & Iulia Siedschlag, 2008. "Managing Capital Flows: Experiences from Central and Eastern Europe," Papers, Economic and Social Research Institute (ESRI) WP234, Economic and Social Research Institute (ESRI).
  29. Kamal Upadhyaya & Mukti Upadhyay, 1999. "Output effects of devaluation: Evidence from Asia," Journal of Development Studies, Taylor & Francis Journals, Taylor & Francis Journals, vol. 35(6), pages 89-103.
  30. Martin Schneider & Aaron Tornell, 2000. "Balance SHeet Effects, Bailout Guarantees and Financial Crises," NBER Working Papers 8060, National Bureau of Economic Research, Inc.
  31. Paul R. Masson, 1998. "Contagion," IMF Working Papers, International Monetary Fund 98/142, International Monetary Fund.
  32. Gilbert Koenig & Irem Zeyneloglu, 2010. "Fiscal policy efficiency and coordination: The New Open Economy Macroeconomics Approach," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-18, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  33. Brad Setser & Nouriel Roubini & Christian Keller & Mark Allen & Christoph B. Rosenberg, 2002. "A Balance Sheet Approach to Financial Crisis," IMF Working Papers, International Monetary Fund 02/210, International Monetary Fund.
  34. Meixing Dai, 2010. "Implications de l’imperfection des marchés financiers pour la politique monétaire," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-15, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  35. Kwack, Sung Yeung, 2000. "An empirical analysis of the factors determining the financial crisis in Asia," Journal of Asian Economics, Elsevier, Elsevier, vol. 11(2), pages 195-206.
  36. Flood, Robert P. & Garber, Peter M., 1984. "Collapsing exchange-rate regimes : Some linear examples," Journal of International Economics, Elsevier, Elsevier, vol. 17(1-2), pages 1-13, August.
  37. Maurice Obstfeld, 1994. "The Logic of Currency Crises," NBER Working Papers 4640, National Bureau of Economic Research, Inc.
  38. Hong, Kiseok & Tornell, Aaron, 2005. "Recovery from a currency crisis: some stylized facts," Journal of Development Economics, Elsevier, Elsevier, vol. 76(1), pages 71-96, February.
  39. Theophile T. Azomahou & Micheline Goedhuys & Phu Nguyen-Van, 2010. "A Structural nonparametric reappraisal of the CO2 emissions-income relationships," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-03, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  40. Miller, Merton, 1998. "Asian financial crisis," Japan and the World Economy, Elsevier, Elsevier, vol. 10(3), pages 355-358, July.
  41. Masson, Paul, 1999. "Contagion:: macroeconomic models with multiple equilibria," Journal of International Money and Finance, Elsevier, Elsevier, vol. 18(4), pages 587-602, August.
  42. Gandolfo, Giancarlo & Goldberg, Michael D., 2005. "International Finance And Open-Economy Macroeconomics," Macroeconomic Dynamics, Cambridge University Press, Cambridge University Press, vol. 9(02), pages 263-266, April.
  43. Marc-Hubert Depret & Abdelillah Hamdouch, 2010. "Les clusters et les réseaux comme fondements de la dynamique d'innovation dans l'industrie biopharmaceutique," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2010-11, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Meixing Dai, 2009. "Models of currency crises with self-fulfilling features: A comment," Working Papers of BETA, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg 2009-14, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.

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:ulp:sbbeta:2009-02. 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: ().

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.