Abstract
Currency crises have occurred frequently in the post-war era. In this article we review the literature on the causes and consequences of currency crises. First- generation models attribute a central role to fiscal policy as a fundamental determinant of crises. Second-generation models emphasize the possibility of self-fulfilling speculative attacks and multiple equilibria. Third-generation models stress how financial fragility can lead to currency crises.
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Burnside, C., Eichenbaum, M., Rebelo, S. (2018). Currency Crises Models. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2177
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DOI: https://doi.org/10.1057/978-1-349-95189-5_2177
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