Title: The Factors that Determine the Financial Crises and the Possibilities in Which They Can Be Anticipated and Prevented
Abstract: The 90's were marked by a high frequency of the financial crises in the developing countries. The crises had a virulent character and strong contagion effects upon other emergent economies and even upon advanced ones. In some of the cases, the crises appeared all of a sudden, affecting countries that, until that precise moment, were considered as having very good economical performances (as, for example, the Asian countries). Even when the economies affected by the crisis were perceived as vulnerable in front of the speculative attacks, the moment of their release often surprised both the respective countries' authorities and the observers. These events, determined, in part, by the increase of the volume, but of the volatility of the private fluxes of capital also, stimulated the research activity referring to the construction of some models able to signal the possibility of producing financial crises. The early warning models of the financial crises include economical and financial variables that can indicate in due time the vulnerability of the payment balance or an unsustainable level of the exchange rate: indicators of the macroeconomic disequilibrium and of the weakness of the banking system (as, for example, the fiscal deficit and the increase rate of the internal credit), of the over-evaluation of the exchange rate (indices of the relative prices, the current account deficit, the increase rate of the exports), of the external vulnerability and the contagion risk (the rapport between the external passives and the international reserves, the incidence of the crises from other countries).
Publication Year: 2008
Publication Date: 2008-01-01
Language: en
Type: article
Indexed In: ['crossref']
Access and Citation
Cited By Count: 1
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot