Publication: Managing the Real and Fiscal Effects of Banking Crises
Date
2002-01
ISSN
Published
2002-01
Author(s)
Klingbiel, Daniela
Laeven, Luc
Abstract
The study provides two recent analyses,
spurred by the recent East Asian crisis, of government
responses to financial distress, and, also presents a
comprehensive database on systemic, and borderline banking
crises. In the first chapter, the authors review the
tradeoffs involved in public policies for systemic,
financial, and corporate sector restructuring. They find
that consistent policies are crucial for success, though
such consistency is often missing. This consistency covers
many dimensions, and entails among other things, ensuring
that there are sufficient resources for absorbing losses,
and, that private agents face appropriate incentives for
restructuring. The authors also find that sustainable
restructuring, requires deep structural reforms, facing
upfront, political economy factors. In the second chapter,
the authors use cross-country evidence to determine whether
specific crisis containment, and resolution policies,
systematically influence the fiscal costs of resolving a
crisis. They find that accommodating policies - such as
blanket deposit guarantees, debtor bailouts, and regulatory
forbearance, etc. - significantly increase fiscal costs. The
third chapter, is a comprehensive database on systemic
banking crises that have occurred since the late 1970s. The
database also includes information on borderline
(non-systemic) banking crises during the same period.
Citation
“Klingbiel, Daniela; Laeven, Luc. 2002. Managing the Real and Fiscal Effects of Banking Crises. World Bank Discussion Paper;No. 428. © Washington, DC: World Bank. http://openknowledge.worldbank.org/entities/publication/77f1af17-28c2-5cfa-8244-1c15d8cd519a License: CC BY 3.0 IGO.”
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