Abstract
‘It is to be noticed that the position of a country which is preponderantly a creditor in the international short-loan market is quite different from that of a country which is preponderantly a debtor. In the former case, which is that of Great Britain, it is a question of reducing the amount lent; in the latter case it is a question of increasing the amount borrowed. A machinery which is adapted for action of the first kind may be ill suited for action of the second.’ Keynes (1924, p. 18)
I have benefitted from comments by Michael Kumhof, Saul Lizondo, Nora Lustig, Enrique Mendoza, Michael Mussa, Assaf Razin, and workshop participants at the IMF and MIT.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Calvo, G. A. (1986) ‘Temporary Stabilization: Predetermined Exchange Rates’ Journal of Political Economy, vol. 94, no. 6, pp. 1319–29.
Calvo, G. A. (1988) ‘Servicing the Public Debt: The Role of Expectations’ American Economic Review, vol, 78, no. 4, pp. 647–61.
Calvo, G. A. and Mendoza, E. G. (1996a) ‘Mexico’s Balance-of-Payments Crisis: A Chronicle of a Death Foretold’, Journal of International Economics, vol. 41, pp. 235–64.
Calvo, G. A. and Mendoza, E. G. (1996b) ‘Costly Information Aversion to Deviate, and the Incentives for Rational Herd Behavior in Global Securities Markets’, manuscript, November, Centre for International Economics, University of Maryland, USA.
Diamond, D. W. and Dybvig, P. H. (1983) ‘Bank Runs, Deposit Insurance, and Liquidity’, Journal of Political Economy, vol. 91, pp. 401–19.
Diaz-Alejandro, C. F. (1989) in Velasco, A. (ed.) Trade, Development and the World Economy, (Oxford and New York: Basil Blackwell).
Easterly, W. R. (1989) ‘Fiscal Adjustment and Deficit Financing during the Debt Crisis’, in Husain, I. and Diwan, I. (eds) Dealing with the Debt Crisis (Washington, DC: The World Bank), pp. 91–113.
Fernandez, R. B. (1991) ‘What Have Populists Learned from Hyperinflation?’, in Dornbusch, R. and Edwards, S. (eds) The Macroeconomics of Populism in Latin America (Chicago: The University of Chicago Press), pp. 121–50.
Flood, R. P. and Garber, P. M. (1984) ‘Gold Monetization and Gold Discipline’, Journal of Political Economy, vol. 92, pp. 90–107.
Keynes, J. M. (1924) Indian Currency and Finance (London: Macmillan).
Kiguel, M. and Liviatan, N. (1992) ‘The Business Cycle Associated with Exchange Rate Based Stabilization’, The World Bank Economic Review, vol. 6, no. 2, pp. 279–305.
Krugman, P. R. (1979) ‘A Model of Balance-of-Payments Crises’, Journal of Money, Credit, and Banking, vol. 11 (August), pp. 311–25.
Obstfeld, M. (1986) ‘Rational and Self-Fulfilling Balance-of-Payments Crises’, American Economic Review, vol. 76, March, pp. 72–81.
Rodriguez, C. A. (1994) ‘Argentina: Fiscal Disequilibria Leading to Hyperinflation’, in Easterly, W., Rodrfguez, C. A. and Schmidt-Hebbel K. (eds) Public Sectors Deficits and Macroeconomic Performance (Washington, DC: The World Bank).
Talvi, E. (1996) ‘Exchange-Rate-Based Stabilization with Endogenous Fiscal Response’, working paper 324, March, Inter-American Development Bank, Washington, DC, USA.
References
Flood, R. P., Garber, P. M. and Kramer, C. (1996) ‘Collapsing Exchange Rate Regimes: Another Linear Example’, Journal of International Economics, vol. 41, November, pp. 223–34.
Milesi-Ferretti, C. M. and Razin, A. (1996) Current Accounts Sustainability, Princeton Studies in International Finance (Princeton, NJ: Princeton University Press.)
Razin, A. Sadka, E. and Yuen, C. W. (1996) ‘Tax principles and Capital Inflows: Is it Efficient to TaxNonresidentIncome?’ workingpaperno. 5513, National Bureau of Economic Research, Cambridge, Mass., USA and forthcoming in Journal of International Economics.
Salant, S. and Henderson, D. (1978) ‘Market Anticipations of Government Policies and the Price of Gold’ Journal ofPolitical Economy, vol. 86, August, pp. 627–48.
Stiglitz, J. and Weiss, A. (1981) ‘Credit Rationing in Models with Imperfect Information’, American Economic Review, 71, pp. 393–410.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Copyright information
© 1998 International Economic Association
About this chapter
Cite this chapter
Calvo, G.A. (1998). Varieties of Capital-Market Crises. In: Calvo, G., King, M. (eds) The Debt Burden and its Consequences for Monetary Policy. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-26077-5_7
Download citation
DOI: https://doi.org/10.1007/978-1-349-26077-5_7
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-26079-9
Online ISBN: 978-1-349-26077-5
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)