Emerging capital markets in turmoil : bad luck or bad policy / Guillermo A. Calvo.

Format:

Book

Author/Creator:

Calvo, Guillermo A.

Language:

English

Subjects (All):

Financial crises.

Capital market.

Financial crises--Developing countries.

Capital market--Developing countries.

Physical Description:

1 online resource (564 p.)

Edition:

1st ed.

Place of Publication:

Cambridge, Mass. : MIT Press, c2005.

Language Note:

English

Summary:

Analysis of financial crises in emerging market economies, including Mexico, Argentina, and Russia; traces the evolution of crisis theory and challenges the conventional wisdom.Since the mid-1990s, emerging market economies have been hit by dramatic highs and lows: lifted by large capital inflows, then plunged into chaos by constrained credit and out-of-control exchange rates. The conventional wisdom about such crises is strongly influenced by the experience of advanced economies. In Emerging Capital Markets in Turmoil, Guillermo Calvo examines these issues instead from the perspective of emerging market economies themselves, taking into account the limitations and vulnerabilities these economies confront. A succession of crises--Mexico in 1994-5, East Asia in 1997, Russia in 1998, and Argentina in 2001--prompted an urgent search in economic policy circles for cogent explanations. Calvo begins by laying the groundwork for a new approach to these issues. In the theoretical chapters that follow, he argues that financial crisis theory regarding emerging markets has progressed from focusing on such variables as fiscal deficits, debt sustainability, and real currency devaluation to stressing the role of the financial sector--emphasizing stocks rather than flows as well as the role credibility plays in containing financial crises. He then returns to a more empirical analysis and focuses on exchange-rate issues, considering the advantages and disadvantages of flexible exchange rates for emerging market economies. Coming after a decade of ongoing crises, Calvo's timely reassessment of the importance of external factors in making emerging market economies safer from financial turmoil offers important policy lessons for dealing with inevitable future episodes of financial crises.

Contents:

Intro

Preface

Introduction

Part I - Early Rumblings

Introduction to Part I

1 Capital Inflows and Real Exchange Rate Appreciation in Latin America: The Role of External Factors - Guillermo A. Calvo, Leonardo Leiderman, and Carmen M. Reinhart

2 Capital Inflows to Latin America: The 1970s and 1990s - Guillermo A. Calvo, Leonardo Leiderman, and Carmen M. Reinhart

Part II The Beast Awakens

Introduction to Part II

3 Capital Flows and Macroeconomic Management: Tequila Lessons - Guillermo A. Calvo

4 Petty Crime and Cruel Punishment: Lessons from the Mexican Debacle - Guillermo A. Calvo and Enrique G. Mendoza

5 Capital Market Contagionand Recession: An Explanation of the Russian Virus - Guillermo Calvo

6 Sudden Stops, the Real Exchange Rate, and Fiscal Sustainability: Argentina'sLessons - Guillermo A. Calvo, AlejandroIzquierdo, and Ernesto Talvi

Part III In Search of a Theory

Introduction to Part III

7 Varieties of Capital-Market Crises - Guillermo A. Calvo

8 Uncertain Duration of Reform: Dynamic Implications - Guillermo A. Calvo and Allan Drazen

9 Capital Flows and Capital-Market Crises: The Simple Economics of Sudden Stops - Guillermo A. Calvo

10 Rational Contagion and the Globalization of Securities Markets - Guillermo A. Calvo and Enrique G. Mendoza

11 Balance-of-Payments Crises in Emerging Markets: Large Capital Inflows and Sovereign Governments - Guillermo A. Calvo

12 Contagion in Emerging Markets: When Wall Street Is a Carrier - Guillermo A. Calvo

13 Explaining Sudden Stop, Growth Collapse, and BOP Crisis: The Case of Distortionary Output Taxes - Guillermo A. Calvo

Part IV The Exchange Rate and All That

Introduction to Part IV

14 Fixing for Your Life - Guillermo A. Calvo and Carmen M. Reinhart.

15 Capital Markets and the Exchange Rate with Special Reference to the Dollarization Debate in Latin America - Guillermo A. Calvo

16 Fear of Floating - Guillermo A. Calvo and Carmen M. Reinhart

Part V Parting Shots

18 Globalization Hazard and Delayed Reform in Emerging Markets - Guillermo A. Calvo

19 Sudden Stop, Contractionary Devaluation, and TimeInconsistency - Guillermo A. Calvo

Sources

Index.

Notes:

Bibliographic Level Mode of Issuance: Monograph

Includes bibliographical references (p. [531]-532) and index.

OCLC-licensed vendor bibliographic record.

ISBN:

9786612097102

9781282097100

1282097105

9780262269728

0262269724

9781423746782

1423746783

OCLC:

62872806