6533b862fe1ef96bd12c6352

RESEARCH PRODUCT

Banking Crises and Short and Medium Term Output Losses in Emerging and Developing Countries: The Role of Structural and Policy Variables

Davide FurceriAleksandra Zdzienicka

subject

Economics and EconometricEconomics and EconometricsSociology and Political ScienceGeography Planning and DevelopmentMonetary policyFinancial crisiDeveloping countryCurrent accountMonetary economicsDevelopmentFinancial deepeningMarket liquidityMedium termOutput losseFinancial crisisDeveloping countrieEconomicsEmerging economieDevelopment3304 EducationEmerging markets

description

The aim of this paper is to assess the dynamic impact of banking crises on output for a panel of developing economies. Using an unbalanced panel of 159 countries from 1970 to 2006, the paper shows that banking crises produce significant output losses. Output losses are larger for relatively richer economies, characterized by a higher level of financial deepening and larger current account imbalances. Flexible exchange rates, fiscal and monetary policy, and liquidity support policies have been found to attenuate the effect of the crises. © 2012 Elsevier Ltd.

yearjournalcountryeditionlanguage
2012-12-01World Development
https://doi.org/10.1016/j.worlddev.2012.03.021