ABSTRACT
Our study of the international macroeconomy has highlighted that both international trade and international financial flows have a profound impact on domestic economic performance. While the International Monetary Fund was explicitly created to manage exchange rates and prevent destabilizing international capital flows, it has not always been successful. The period of financial liberalization since the 1970s has been accompanied by a number of severe currency crises in developed and developing countries. This chapter provides an account of the recent currency crises and their causes. We focus especially on the origins of the Debt Crisis in the 1980s and the Asian Financial Crisis in the 1990s.1
