A corporate balance-sheet approach to currency crises
نویسندگان
چکیده
منابع مشابه
A corporate balance-sheet approach to currency crises
This paper presents a general equilibrium currency crisis model of the third generation, in which the possibility of currency crises is driven by the interplay between private Þrms credit-constraints and nominal price rigidities. Despite our emphasis on microfoundations, the model remains sufficiently simple that the policy analysis can be conducted graphically. The analysis hinges on four m...
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This paper explores the linkage between corporate risk management strategies, investment, and economic stability in an open economy with a flexible exchange rate regime. Firms use currency futures contracts to manage their exchange rate exposure – caused by balance sheet effects as in Krugman (2000) – and therefore their investments’ sensitivity to currency risk. We find that, depending on whet...
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We examine the impact of corporate currency hedging on economic stability by introducing hedging activity in a Mundell-Fleming-Tobin framework for analyzing currency and financial crises. The ratio between hedged and unhedged firms is modelled depending on firm size as well as hedging costs. The results indicate that, with an increasing fraction of hedged firms in an economy, the magnitude of a...
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The paper by Barry Eichengreen and Ricardo Haussman is correct to focus on the policies that the emerging market countries (EMC) themselves can pursue to reduce the risk of future economic crises, instead of discussing new policies for the IMF or for the industrial countries that some analysts hope might achieve that goal. I agree with their emphasis on EMC self-help and on the multiple causes ...
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This chapter was originally published in The Evidence and Impact of Financial Globalization published by Elsevier, and the attached copy is provided by Elsevier for the author's benefit and for the benefit of the author's institution, for noncommercial research and educational use including without limitation use in instruction at your institution, sending it to specific colleagues who you know...
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ژورنال
عنوان ژورنال: Journal of Economic Theory
سال: 2004
ISSN: 0022-0531
DOI: 10.1016/j.jet.2003.06.004