ABSTRACT
Currency crises experiences in the past (ERM 1992-93, Latin America 1994-95 and Asia 1997-98) have always had broad reflections on the theory of economics. In order to explain the triggering factors of the crises many models had been developed by economists following the seminal paper of Krugman (1979). In this paper, we firstly presented a summary of the different generations of these models in connection with the case studies mentioned above. Then, we analyzed the 1994 financial crisis in Turkey, including its determinants and policy implications for the future. The main purpose of this paper is to investigate and discuss the predictability of possible currency crises in Turkey by using the leading economic indicators approach.
