The Duration of Capital Account Crises—An Empirical Analysis

David Hofman, Ruben Atoyan, Dimitri Tzanninis and Mauro Mecagni

No 2007/258, IMF Working Papers from International Monetary Fund

Abstract: This paper examines the duration of capital account crises. We develop a new index to identify both the start and the end of these crises. Applying the index to a sample of 18 crisis episodes, we derive stylized facts on crisis duration and review the economic and financial circumstances that prevailed at the dusk of crises, a relatively unexplored area. We use the econometric technique of duration analysis to gauge the relative importance of various factors affecting the probability of exiting a crisis. We find that initial and external conditions are key determinants. But fiscal and monetary policies can also help shorten crisis duration.

Keywords: WP; crisis duration; IMF staff calculation; IMF financing; crisis episode (search for similar items in EconPapers)
Pages: 42
Date: 2007-11-01
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Citations: View citations in EconPapers (3)

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