De Gregorio, JoséValdés, Rodrigo O.2014-03-272014-03-272001-05World Bank Economic Reviewhttps://hdl.handle.net/10986/17443This 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.en-USCC BY-NC-ND 3.0 IGOACCOUNTINGAGRICULTUREANNUAL GROWTHASSETSBALANCE OF PAYMENTSBALANCE OF PAYMENTS CRISESBANK LENDINGBILATERAL TRADEBUDGET DEFICITCAPITAL CONTROLCAPITAL CONTROLSCAPITAL INFLOWSCAPITAL MOVEMENTSCAPITAL TRANSACTIONSCOMPETITIVE DEVALUATIONCOMPETITIVE DEVALUATIONSCONSTANTSCONSUMER PRICE INDEXCOUNTRY CREDITCREDIT BOOMCREDIT BOOMSCREDIT RATINGCREDIT RATINGSCREDIT RISKCRISES IN EMERGING MARKETSCRISIS CONTAGIONCROSS-COUNTRY EXPERIENCECURRENCYCURRENCY CRISESCURRENCY CRISISCURRENT ACCOUNTCURRENT ACCOUNT BALANCECURRENT ACCOUNT DEFICITCURRENT ACCOUNT DEFICITSDATA AVAILABILITYDEBT COMPOSITIONDEBT CRISISDEBT MATURITYDEBT STRUCTUREDEPENDENT VARIABLEDEPOSITSDEPRECIATIONDEVALUATIONDEVELOPING COUNTRIESDEVELOPMENT ECONOMICSDOMESTIC CREDITDUMMY VARIABLEDUMMY VARIABLESEMERGING MARKETSEQUILIBRIUMERROR TERMEXCHANGE ARRANGEMENTSEXCHANGE RATEEXCHANGE RATE FLEXIBILITYEXCHANGE RATE REGIMESEXCHANGE RESTRICTIONSEXPLANATORY VARIABLEEXTERNAL ASSETSEXTERNAL DEBTEXTERNAL SHOCKEXTERNAL SHOCKSFINANCIAL CRISESFINANCIAL INTEGRATIONFINANCIAL SECTORFINANCIAL SUPPORTFISCAL BALANCEFIXED EXCHANGE RATEFIXED EXCHANGE RATE REGIMEFLEXIBLE EXCHANGE RATEFLEXIBLE EXCHANGE RATE REGIMESFOREIGN DEBTFOREIGN EXCHANGEFOREIGN EXCHANGE MARKETGDPGLOBALIZATIONGROSS DOMESTIC PRODUCTGROWTH RATEINDUSTRIAL COUNTRIESINFLATIONINSTITUTIONAL INVESTORINTERDEPENDENCEINTEREST RATE SHOCKINTEREST RATESINTERNATIONAL BANKINTERNATIONAL BANK LENDINGINTERNATIONAL CRISESINTERNATIONAL CRISISINTERNATIONAL FINANCEINTERNATIONAL FINANCIAL STATISTICSINTERNATIONAL INTERESTINTERNATIONAL INTEREST RATEINTERNATIONAL RESERVESINTERNATIONAL SETTLEMENTSLEADING INDICATORSM1M2MACROECONOMIC CONDITIONSMACROECONOMIC VARIABLEMARKET COMPETITIONMARKET PRESSUREMARKET PRESSURESMATURITY STRUCTUREMISALIGNMENTMONETARY FUNDMONEY SUPPLYNARROW BANDSOUTPUTOUTPUT COLLAPSEOVERVALUATIONPARTICULAR COUNTRYPRICE INDEXPRIVATE CREDITRATE OF GROWTHRATE OF INFLATIONREAL DEPRECIATIONREAL EXCHANGE RATEREAL EXCHANGE RATE APPRECIATIONREAL EXCHANGE RATE OVERVALUATIONREAL EXCHANGE RATESREAL INTERESTREAL INTEREST RATEREAL SHOCKSRETURNSSHOCK PROXYSHORT-TERM DEBTSTANDARD DEVIATIONSTOCK MARKETSURRENDER REQUIREMENTTEQUILA CRISISTIME HORIZONTOTAL CREDITTOTAL DEBTTOTAL EXPORTSTRADE PATTERNTRANQUIL TIMESTRANSMISSION MECHANISMTRANSMISSION MECHANISMSVOLATILITYVULNERABILITYWEIGHTSJournal ArticleWorld Bank10.1596/17443