Government Finance in the Wake of Currency Crises
68 Pages Posted: 8 Aug 2003
There are 3 versions of this paper
Government Finance in the Wake of Currency Crises
Government Finance in the Wake of Currency Crises
Date Written: June 2003
Abstract
This Paper addresses two questions: (i) how do governments actually pay for the fiscal costs associated with currency crises; and (ii) what are the implications of different financing methods for post-crisis rates of inflation and depreciation? We study these questions using a general equilibrium model in which a currency crisis is triggered by prospective government deficits. We then use our model in conjunction with fiscal data to interpret government financing in the wake of three recent currency crises: Korea (1997), Mexico (1994) and Turkey (2001).
Keywords: Currency crisis, banking crisis, speculative attacks, seigniorage, fiscal reform, bailouts
JEL Classification: F31
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
A Fiscal Theory of Sovereign Risk
By Martín Uribe
-
Government Finance in the Wake of Currency Crises
By A. Craig Burnside, Martin Eichenbaum, ...
-
Government Finance in the Wake of Currency Crises
By A. Craig Burnside, Martin Eichenbaum, ...
-
On the Fiscal Implications of Twin Crises
By A. Craig Burnside, Martin Eichenbaum, ...
-
On the Fiscal Implications of Twin Crises
By A. Craig Burnside, Martin Eichenbaum, ...
-
On the Fiscal Implications of Twin Crises
By A. Craig Burnside, Martin Eichenbaum, ...
-
High Public Debt in Currency Crises: Fundamentals Versus Signalling Effects
-
By Kenneth M. Kletzer and Renu Kohli