On Graduation from Default, Inflation and Banking Crisis: Elusive or Illusion?

Rong Qian (), Carmen Reinhart and Kenneth Rogoff

No 16168, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper uses a data set of over two hundred years of sovereign debt, banking and inflation crises to explore the question of how long it takes a country to "graduate" from the typical pattern of serial crisis that most emerging markets experience. We find that for default and inflation crises, twenty years is a significant market, but the distribution of recidivism has extremely fat tails. In the case of banking crises, it is unclear whether countries ever graduate. We also examine the more recent phenomenon of IMF programs, which sometimes result in "near misses" but sometimes end in default even after a program is instituted. The paper raises the important theoretical question of why countries experience serial default, and how they might graduate.

JEL-codes: E6 F3 N0 (search for similar items in EconPapers)
Date: 2010-07
Note: IFM ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Published as On Graduation from Default, Inflation and Banking Crises: Elusive or Illusion? , Rong Qian, Carmen M. Reinhart, Kenneth S. Rogoff. in NBER Macroeconomics Annual 2010, volume 25 , Acemoglu and Woodford. 2011

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Related works:
Chapter: On Graduation from Default, Inflation and Banking Crises: Elusive or Illusion? (2011)
Working Paper: Do countries “graduate” from crises? Some historical perspective (2010)
Working Paper: On Graduation from Default, Inflation and Banking Crises: Elusive or Illusion?
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