EconPapers    
Economics at your fingertips  
 

Assessing the effect of current account and currency crises on economic growth

Christian Aßmann

No 80, BERG Working Paper Series from Bamberg University, Bamberg Economic Research Group

Abstract: Several empirical studies are concerned with measuring the effect of currency and current account crises on economic growth. Using different empirical models this paper serves two aspects. It provides an explicit assessment of country specific factors influencing the costs of crises in terms of economic growth and controls via a treatment type model for possible sample selection governing the occurrence of crises in order to estimate the impact on economic growth correctly. The applied empirical models allow for rich intertemporal dependencies via serially correlated errors and capture latent country specific heterogeneity via random coefficients. For accurate estimation of the treatment type model a simulated maximum likelihood approach employing efficient importance sampling is used. The results reveal significant costs in terms of economic growth for both crises. Costs for reversals are linked to country specific variables, while costs for currency crises are not. Furthermore, shocks explaining current account reversals and growth show strong significant positive correlation.

Keywords: Currency crises; Current account reversals; Treatment Model; Discrete dependent variable; Efficient Importance Sampling; Panel Data (search for similar items in EconPapers)
JEL-codes: F32 C15 C23 C33 O10 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-fdg, nep-ifn and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9) Track citations by RSS feed

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/45547/1/658138502.pdf (application/pdf)

Related works:
Working Paper: Assessing the Effect of Current Account and Currency Crises on Economic Growth (2008) Downloads
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:zbw:bamber:80

Access Statistics for this paper

More papers in BERG Working Paper Series from Bamberg University, Bamberg Economic Research Group Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().

 
Page updated 2021-05-15
Handle: RePEc:zbw:bamber:80