Government Finance in the Wake of Currency Crises

Craig Burnside (), Martin Eichenbaum () and Sergio Rebelo ()

No 9786, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper addresses two questions: (i) how do governments actually pay for the fiscal costs associated with currency crises; and (ii) what are the implications of different financing methods for post-crisis rates of inflation and depreciation? We study these questions using a general equilibrium model in which a currency crisis is triggered by prospective government deficits. We then use our model in conjunction with fiscal data to interpret government financing in the wake of three recent currency crises: Korea (1997), Mexico (1994) and Turkey (2001).

JEL-codes: F31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac and nep-rmg
Date: 2003-06
Note: EFG IFM ME PE
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Related works:
Working Paper: Government Finance in the Wake of Currency Crises (2003)
Working Paper: Government Finance in the Wake of Currency Crises (2003)
Working Paper: Government Finance in the Wake of Currency Crises (2005)
Journal Article: Government finance in the wake of currency crises (2006)
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