The Russian triple crisis 1998: currency, finance and budget
The paper analyzes the Russian currency crisis in August 1998. By critically discussing the existing literature and by descriptively investigating data, the relative importance of economic fundamentals, expectations, structural factors and external causes is assessed. The paper highlights the contradicting requirements on the macroeconomic policy of a transition economy that has a history of inflationary financing. The argument is that none of the previous analyzes has highlighted clearly the triple crisis nature of the events: the crises in the currency and financial markets were inseparably intertwined to the fiscal problems. However, in this emerging market context the budget deficit cannot be stated to be the sole cause in the traditional sense of the so-called first-generation currency crises theories.
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- Allan Drazen & Elhanan Helpman, 1987. "Stabilization with Exchange Rate Management," The Quarterly Journal of Economics, Oxford University Press, vol. 102(4), pages 835-855.
- Olga Butorina, 2000. "Implications of the Russian Crisis," Post-Communist Economies, Taylor & Francis Journals, vol. 12(4), pages 409-424.
- Allan Drazen & Elhanan Helpman, 1987. "Stabilization with Exchange Rate Management under Uncertainty," NBER Working Papers 2268, National Bureau of Economic Research, Inc.
- Maurice Obstfeld, 1994. "The Logic of Currency Crises," NBER Working Papers 4640, National Bureau of Economic Research, Inc.
- Eichengreen, Barry, 1999. "Kicking the Habit: Moving from Pegged Rates to Greater Exchange Rate Flexibility," Economic Journal, Royal Economic Society, vol. 109(454), pages C1-14, March.
- Nancy P. Marion & Robert P Flood, 1998.
"Perspectiveson the Recent Currency Crisis Literature,"
IMF Working Papers
98/130, International Monetary Fund.
- Flood, Robert & Marion, Nancy, 1999. "Perspectives on the Recent Currency Crisis Literature," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 4(1), pages 1-26, January.
- Robert Flood & Nancy Marion, 1998. "Perspectives on the Recent Currency Crisis Literature," NBER Working Papers 6380, National Bureau of Economic Research, Inc.
- Nikolic, Milan, 2000. "Money Growth-Inflation Relationship in Postcommunist Russia," Journal of Comparative Economics, Elsevier, vol. 28(1), pages 108-133, March.
- Niko Gobbin & Bruno Merlevede, 2000. "The Russian Crisis: A Debt Perspective," Post-Communist Economies, Taylor & Francis Journals, vol. 12(2), pages 141-163.
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