Collapsing exchange-rate regimes

Flood, Robert P.; Garber, Peter M.

doi:10.1016/0022-1996(84)90002-3

Cited by 922 publications

(512 citation statements)

References 5 publications

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“…Central bank reserves play a role in exchange rate crises only when political considerations prevent the implementation of unpopular policies. For example, in the first generation speculative attack model of Krugman (1979) and Flood and Garber (1984) a crisis occurs because the central bank finances a fiscal deficit by expanding domestic credit. In the absence of any offsetting changes the money supply expands and the exchange rate depreciates.…”

Section: Introductionmentioning

confidence: 99%

The lifetime of a unilateral target zone: some extended results

Broome

2001

Journal of International Money and Finance

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In Dumas and Svensson (Journal of International Economics 36 (1994) 467) the lifetime of a Krugman (Quarterly Journal of Economics 106 (1991) 669-682) type target zone model is found to be extremely long. This paper shows that the lifetime of the identical target zone regime can be much lower when real disturbances occur. In particular, the mean lifetime is found to be very low when real disturbances occur and the real exchange rate elasticity of the demand for domestic goods is very low. It is also shown that allowing for monetary disturbances to have real effects has very little effect on the lifetime. The results indicate the conditions under which real disturbances might trigger currency crises. 

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Section: Introductionmentioning

confidence: 99%

The lifetime of a unilateral target zone: some extended results

Broome

2001

Journal of International Money and Finance

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“…This model has been improved during the 1980s, especially under the impulse of the work of Flood and Garber (1984). In this family of models, the crisis is explained by a degradation of the fundamentals of the economy, which at a given time, become incompatible with the maintenance of fixed exchange rate: an objective contradiction between the two macroeconomic aspects, namely the deficit of current payments and the fixity of the exchange rate.…”

Section: The Models Of First and Second Generation Seem To Be Inappromentioning

confidence: 99%

Untitled

2015

Asian Development Policy Review

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This paper is consecrated to the literature review of the theoretical and empirical literature devoted to the outbreak of the Asian crisis in Contribution/ OriginalityThis study contributes to the existing literature by providing a comprehensive framework for better understanding the Asian crisis. It further points to the lack of consensus on the origins of this crisis and the existence of a multitude of reflections offered by the literature.

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“…Krugman (1979) and Flood and Garber (1984) emphasize budget deficits that must eventually be money-financed, but a broader array of factors would also include monetary policy indiscipline, overvalued exchange rates and contagion from crises in important trading partners.…”

Section: First Generation: Macroeconomic Vulnerabilitiesmentioning

confidence: 99%

Is East Asia Safe from Financial Crises?1

Wyplosz¹

2008

China, Asia, and the New World Economy

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This paper looks at the measures taken by East Asian countries since the 1997-8 crisis to reduce the odds of a new crisis. It finds that odds are low, but far from zero. Much progress has been done to deal with the vulnerabilities that have been identified so far, but some remain. The massive accumulation of foreign exchange reserves is raising the threshold at which markets would trigger speculative attacks, but the threshold is still well within reach of international markets. Efforts at building a regional defense system are slow and unlikely to come to fruition in the near future.

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Collapsing exchange-rate regimes

Cited by 922 publications

References 5 publications

The lifetime of a unilateral target zone: some extended results

The lifetime of a unilateral target zone: some extended results

Untitled

Is East Asia Safe from Financial Crises?1

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