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International Monetary Fund Resources and Contagion Mechanisms: A Hypothesis

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  • Francesca Viani

    (Università degli Studi di Siena)

Abstract

This paper examines analytically the possibility that, due to the limitedness of its resources, the International Monetary Fund (IMF) could spread financial crises rather than preventing them, thus developing into a contagion channel. The model we build, based on the most recent global-games literature, allows us to show that this risk is sensible from a theoretical point of view. We conclude that the IMF, when planning its interventions, should take into account this kind of contagion it contributes in creating. Some policy implications are derived.

Suggested Citation

  • Francesca Viani, 2005. "International Monetary Fund Resources and Contagion Mechanisms: A Hypothesis," Rivista di Politica Economica, SIPI Spa, vol. 95(6), pages 69-103, November-.
    • Handle: RePEc:rpo:ripoec:v:95:y:2005:i:6:p:69-103
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    References listed on IDEAS

    as
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    More about this item

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems

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