Publication: Crisis Transmission : Evidence from the Debt, Tequila, and Asian Flu Crises
Date
2001-05
ISSN
Published
2001-05
Author(s)
De Gregorio, José
Valdés, Rodrigo O.
Abstract
This article analyzes how external
crises spread across countries. The authors analyze the
behavior of four alternative crisis indicators in a sample
of 20 countries during three well-known crises: the 1982
debt crisis, the 1994 Mexican crisis, and the 1997 Asian
crisis. The objective is twofold: to revisit the
transmission channels of crises, and to analyze whether
capital controls, exchange rate flexibility, and debt
maturity structure affect the extent of contagion. The
results indicate that there is a strong neighborhood effect.
Trade links and similarity in pre-crisis growth also explain
(to a lesser extent) which countries suffer more contagion.
Both debt composition and exchange rate flexibility to some
extent limit contagion, whereas capital controls do not
appear to curb it.
Link to Data Set
Citation
“De Gregorio, José; Valdés, Rodrigo O.. 2001. Crisis Transmission : Evidence from the Debt, Tequila, and Asian Flu Crises. World Bank Economic Review. © Washington, DC: World Bank. http://hdl.handle.net/10986/17443 License: CC BY-NC-ND 3.0 IGO.”
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World Bank Economic Review
1564-698X
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