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Preventing financial instability and currency crises

Author

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  • Siebert, Horst

Abstract

Financial crises can have a severe impact on the real side of the economy with countries losing up to 20 percent of GDP. The paper studies rules that prevent financial instability and currency crises. These include institutional arrangements for a solid banking system, prudent regulations and appropriate principles of monetary policy. The paper studies the role of the IMF in light of the past experience in preventing currency crises and a systemic breakdown of the world's financial system and points out necessary IMF reforms. It discusses how the IMF should adjust to the structural changes in the world economy.

Suggested Citation

  • Siebert, Horst, 2008. "Preventing financial instability and currency crises," Kiel Working Papers 1401, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:1401
    as

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    File URL: https://www.econstor.eu/bitstream/10419/4162/1/kap1401.pdf
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    References listed on IDEAS

    as
    1. James Tobin, 1978. "A Proposal for International Monetary Reform," Eastern Economic Journal, Eastern Economic Association, vol. 4(3-4), pages 153-159, Jul/Oct.
    2. Jeffrey A. Frankel & C. Fred Bergsten & Michael L. Mussa, 1994. "Exchange Rate Policy," NBER Chapters, in: American Economic Policy in the 1980s, pages 293-366, National Bureau of Economic Research, Inc.
    3. Williamson, John, 1993. "Exchange Rate Management," Economic Journal, Royal Economic Society, vol. 103(416), pages 188-197, January.
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    Cited by:

    1. Ian Thomas & Kathryn Hegarty & Stuart Whitman & Val Macgregor, 2012. "Professional Associations," Journal of Education for Sustainable Development, , vol. 6(1), pages 121-136, March.
    2. Woosik Moon, 2012. "The G20 and Asian Monetary Cooperation," Chapters, in: Jehoon Park & T. J. Pempel & Geng Xiao (ed.), Asian Responses to the Global Financial Crisis, chapter 8, Edward Elgar Publishing.
    3. Woosik Moon & Yeongseop Rhee, 2012. "Asian Monetary Integration," Books, Edward Elgar Publishing, number 14191.
    4. Andrea Colabella & Enrica Di Stefano & Claudia Maurini, 2009. "The reform of IMF quotas: the way towards the 2008 resolution," Questioni di Economia e Finanza (Occasional Papers) 54, Bank of Italy, Economic Research and International Relations Area.

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    More about this item

    Keywords

    Rules for monetary stability; Hedge funds; Exchange rate crises; IMF; IMF quotas; Financial instability;
    All these keywords.

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • G2 - Financial Economics - - Financial Institutions and Services
    • P00 - Political Economy and Comparative Economic Systems - - General - - - General

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