ABSTRACT
Four waves of financial crises have hit international capital markets during the 1990s; the European Monetary System (EMS) crisis in 1992-1993, the collapse of the Mexican peso with ‘tequilla effects’ in 1994-1995, the Asian flu of 1997-1998 and the Russian virus in 1998. These financial crises stimulated the theoretical and empirical literature on the economics of the crises in several ways, among other things on the determinants of a crisis (Kaminsky and Reinhart, 1999), its impact on domestic output (Aghion, Bacchetta and Banerjee, 2001) and policy implications (Rogoff, 1999).
