Expectations, the business cycle and the Mexican peso crisis

Moritz Cruz, Edmund Amann and Bernard Walters

Cambridge Journal of Economics, 2006, vol. 30, issue 5, 701-722

Abstract: The 1994--95 'peso' crisis did not display characteristics which allow it to be easily captured by traditional crisis models. Models based on Minsky's financial fragility hypothesis offer more persuasive accounts but have been supported by relatively little direct empirical evidence. This paper provides such evidence, with particular attention being paid to the role of domestic financial liberalisation in the process. Minsky's hypotheses about the evolution of expectations over the business cycle are tracked using business survey data. In addition, crisis indicators are constructed, reflecting the changing vulnerability of the economy to shocks. The findings support a Minskyian interpretation of the crisis. Copyright 2006, Oxford University Press.

Date: 2006
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/10.1093/cje/bei103 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:cambje:v:30:y:2006:i:5:p:701-722

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Cambridge Journal of Economics is currently edited by Jacqui Lagrue

More articles in Cambridge Journal of Economics from Cambridge Political Economy Society Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().