Fundamentals, Contagion and Currency Crises

Download or read book Fundamentals, Contagion and Currency Crises written by Mark Kruger and published by . This book was released on 1998 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the determinants of currency crises in Latin America, Asia, and Africa. It asks two basic questions: are currency crises linked to economic fundamentals, and is there evidence of a contagion effect after controlling for the potential effects of economic fundamentals. The examination uses pooled annual data for 19 developing countries spanning the period 1977-93. Economic variables considered include the growth rate of domestic credit, real exchange rate misalignment, the relation of the M2 monetary aggregate to international reserves, and fiscal or current account deficits.