financial markets over the last decade, large capital flow reversals can occur quite quickly, considerably shortening the time policymakers have to respond. As a consequence, and motivated in part by the recent crises in Europe (1992), Mexico (1994–95), and Asia (1997–98), researchers are taking a fresh look at the determinants of currency and banking crises and are attempting to develop early ...

EGINNING WITH THE stock market crash in October 1929, the United States suffered a series of financial crises that mark the Great Depression. In each crisis, the number of bank failures and the declines in bank reserves, the money stock and economic activity were greater than in the preceding episodes. Many researchers investigating the causes of financial crises during the Great Depression hav...

Currency crises appear to spread regionally. In this paper we use Bayesian methodology on data from four waves of currency crises in the late twentieth century to examine the mechanism by which currency crises spread from one country to another. In particular, we examine whether trade linkages, “other” unquantifiable linkages proxied for by relative geographical distance, or macroeconomic and f...