Understanding Devaluations in Latin America: A "Bad Fundamentals" Approach
AbstractThis paper is an empirical study of the determinants of Latin American devaluations during the period between 1957 and 1988. The estimation of probabilities of devaluation is done using logit analysis. The empirical results show that reserves, the real exchange rate, the share of domestic credit to the public sector and the current account deficit have a significant effect on the likelihood of a devaluation. In summary, this paper confirms the view that devaluations in Latin America are a consequence of the state of fundamentals in these economies.
Download InfoIf 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.
Bibliographic InfoPaper provided by EconWPA in its series International Finance with number 9805004.
Length: 41 pages
Date of creation: 28 May 1998
Date of revision:
Note: 41 pages text, plus appendix
Contact details of provider:
Web page: http://184.108.40.206
Other versions of this item:
- Martinez Peria, Maria Soledad, 1997. "Understanding Devaluations in Latin America: A 'Bad Fundamentals' Approach," Center for International and Development Economics Research, Working Paper Series qt1h89j1pp, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
- F30 - International Economics - - International Finance - - - General
- F31 - International Economics - - International Finance - - - Foreign Exchange
This paper has been announced in the following NEP Reports:
- NEP-ALL-1998-10-02 (All new papers)
- NEP-FMK-1998-10-08 (Financial Markets)
- NEP-IFN-1998-10-02 (International Finance)
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.:
- Michael W. Klein & Nancy P. Marion, 1994.
"Explaining the Duration of Exchange-Rate Pegs,"
NBER Working Papers
4651, National Bureau of Economic Research, Inc.
- Willman, Alpo, 1988. "The collapse of the fixed exchange rate regime with sticky wages and imperfect substitutability between domestic and foreign bonds," European Economic Review, Elsevier, vol. 32(9), pages 1817-1838, November.
- Flood, Robert P. & Garber, Peter M., 1984. "Collapsing exchange-rate regimes : Some linear examples," Journal of International Economics, Elsevier, vol. 17(1-2), pages 1-13, August.
- Robert P. Flood & Peter M. Garber, 1980.
"Gold Monetization and Gold Discipline,"
NBER Working Papers
0544, National Bureau of Economic Research, Inc.
- Goldberg, Linda S., 1994.
"Predicting exchange rate crises : Mexico revisited,"
Journal of International Economics,
Elsevier, vol. 36(3-4), pages 413-430, May.
- Goldberg, Linda S., 1990. "Predicting Exchange Rate Crises: Mexico Revisited," Working Papers 90-11, C.V. Starr Center for Applied Economics, New York University.
- Linda S. Goldberg, 1990. "Predicting Exchange Rate Crises: Mexico Revisited," NBER Working Papers 3320, National Bureau of Economic Research, Inc.
- Obstfeld, Maurice, 1986.
"Rational and Self-fulfilling Balance-of-Payments Crises,"
American Economic Review,
American Economic Association, vol. 76(1), pages 72-81, March.
- Maurice Obstfeld, 1986. "Rational and Self-Fulfilling Balance-of-Payments Crises," NBER Working Papers 1486, National Bureau of Economic Research, Inc.
- Barry Eichengreen & Andrew K. Rose & Charles Wyplosz, 1994.
"Speculative Attacks on Pegged Exchange Rates: An Empirical Exploration with Special Reference to the European Monetary System,"
NBER Working Papers
4898, National Bureau of Economic Research, Inc.
- Barry Eichengreen, Andrew K. Rose, and Charles Wyplosz., 1995. "Speculative Attacks on Pegged Exchange Rates: An Empirical Exploration with Special Reference to the European Monetary System," Center for International and Development Economics Research (CIDER) Working Papers C95-046, University of California at Berkeley.
- Eichengreen, Barry & Rose, Andrew K & Wyplosz, Charles, 1994. "Speculative Attacks on Pegged Exchange Rates: An Empirical Exploration with Special Reference to the European Monetary System," CEPR Discussion Papers 1060, C.E.P.R. Discussion Papers.
- Barry Eichengreen & Andrew K. Rose & Charles Wyplosz, 1995. "Speculative attacks on pegged exchange rates: an empirical exploration with special reference to the European Monetary System," Working Papers in Applied Economic Theory 95-04, Federal Reserve Bank of San Francisco.
- Krugman, Paul, 1979. "A Model of Balance-of-Payments Crises," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 11(3), pages 311-25, August.
- Peria, Maria Soledad Martinez, 1999. "A regime - switching approach to studying speculative attacks : focus on European Monetary System crises," Policy Research Working Paper Series 2132, The World Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA).
If references are entirely missing, you can add them using this form.