IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

A Contribution to the Theory of Financial Fragility and Crisis

  • Amit Bhaduri
Registered author(s):

    Three interrelated aspects typical of most financial crisis of domestic origin are brought together in a model in this paper. The first aspect is debt financed consumption boom supported by rising asset prices which ultimately leads to credit crunch and debt deflation as lenders lose confidence in borrowers. This is related to the second aspect tracing gradual evolution towards Ponzi finance. This is accompanied by fragility of the financial sector itself and its insolvency as an inevitable outcome of unregulated economic expansion. The paper concludes with comments on how these three aspects interact in the real world of possible extensions.

    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.wiiw.ac.at/a-contribution-to-the-theory-of-financial-fragility-and-crisis-dlp-2128.pdf
    Download Restriction: no

    Paper provided by The Vienna Institute for International Economic Studies, wiiw in its series wiiw Working Papers with number 65.

    as
    in new window

    Length: 18 pages including 2 Figures
    Date of creation: May 2010
    Date of revision:
    Publication status: Published as wiiw Working Paper
    Handle: RePEc:wii:wpaper:65
    Contact details of provider: Postal: Rahlgasse 3, A-1060 Vienna
    Phone: (+43-1) 533 66 10
    Fax: (+43-1) 533 66 10-50
    Web page: http://www.wiiw.ac.at
    Email:


    More information through EDIRC

    Order Information: Web: http://wiiw.ac.at

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:wii:wpaper:65. 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: (Customer service)

    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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.