Similar Search Results

The Price Theory of Money, Prospero's Liquidity Trap, and Sudden Stop: Back to Basics and Back

Calvo, Guillermo - National Bureau of Economic Research (NBER) - 2012

Fiat money contains the seeds of its own destruction. It has no intrinsic value and, yet, it can be exchanged for valuable consumption and production goods. As Hahn (1965) shows, this situation puts fiat money's market value or liquidity premium at the brink of collapse. In this paper I will...

Persistent link: https://www.econbiz.de/10010796587

Optimal Holdings of International Reserves: Self-Insurance against Sudden Stop

Calvo, Guillermo; Izquierdo, Alejandro; Loo-Kung, Rudy - National Bureau of Economic Research (NBER) - 2012

This paper addresses the issue of the optimal stock of international reserves in terms of a statistical model in which reserves affect both the probability of a Sudden Stop-as well as associated output costs-by reducing the balance-sheet effects of liability dollarization. Optimal reserves are...

Persistent link: https://www.econbiz.de/10010951260

Phoenix Miracles in Emerging Markets: Recovering without Credit from Systemic Financial Crises

Calvo, Guillermo; Izquierdo, Alejandro; Talvi, Ernesto - National Bureau of Economic Research (NBER) - 2006

inflation and falling real wages, casting doubts on price deflation and nominal wage rigidity as key elements in explaining …

Persistent link: https://www.econbiz.de/10005084838

On the Empirics of Sudden Stops: The Relevance of Balance-Sheet Effects

Calvo, Guillermo; Izquierdo, Alejandro; Mejia, Luis-Fernando - National Bureau of Economic Research (NBER) - 2004

Using a sample of 32 developed and developing countries we analyze the empirical characteristics of sudden stops in capital flows and the relevance of balance sheet effects in the likelihood of their materialization. We find that large real exchange rate (RER) fluctuations coming hand in hand...

Persistent link: https://www.econbiz.de/10005085290

Systemic Sudden Stops: The Relevance Of Balance-Sheet Effects And Financial Integration

Calvo, Guillermo; Izquierdo, Alejandro; Mejía, … - National Bureau of Economic Research (NBER) - 2008

Using a sample of 110 developed and developing countries for the period 1990-2004 we analyze the empirical characteristics of systemic sudden stops (3S) in capital flows --understood as large and largely unexpected capital account contractions that occur in periods of systemic turmoil -- and the...

Persistent link: https://www.econbiz.de/10005710746

Fear of Floating

Calvo, Guillermo; Reinhart, Carmen - National Bureau of Economic Research (NBER) - 2000

In recent years, many countries have suffered severe financial crises, producing a staggering toll on their economies, particularly in emerging markets. One view blames fixed exchange rates-- soft pegs'--for these meltdowns. Adherents to that view advise countries to allow their currency to...

Persistent link: https://www.econbiz.de/10005828836

Crises in Emerging Market Economies: A Global Perspective

Calvo, Guillermo - National Bureau of Economic Research (NBER) - 2005

The paper argues that global financial factors played an important role in the capital-inflow episode in Emerging Market economies (EMs), during the early part of the 1990s, and clearly in the Sudden Stop (of capital inflows) crises that took place after the 1998 Russian crisis. Moreover, the...

Persistent link: https://www.econbiz.de/10005774877

Sudden Stop, Financial Factors and Economic Collpase in Latin America: Learning from Argentina and Chile

Calvo, Guillermo; Talvi, Ernesto - National Bureau of Economic Research (NBER) - 2005

This paper shows that the Russian 1998 crisis had a big impact on capital flows to Emerging Market Economies, EMs, especially in Latin America, and that the impact of the Russian shock differs quite markedly across EMs. To illustrate this statement, we compare the polar cases of Chile and...

Persistent link: https://www.econbiz.de/10005033492

Relative Price Volatility Under Sudden Stops: The Relevance of Balance Sheet Effects

Calvo, Guillermo; Izquierdo, Alejandro; Loo-Kung, Rudy - National Bureau of Economic Research (NBER) - 2005

Sudden Stops are associated with increased volatility in relative prices. We introduce a model based on information acquisition to rationalize this increased volatility. An empirical analysis of the conditional variance of the wholesale price to consumer price ratio using panel ARCH techniques...

Persistent link: https://www.econbiz.de/10005580326

Inflation Inertia and Credible Disinflation - The Open Economy Case

Calvo, Guillermo; Kumhof, Michael; Celasun, Oya - National Bureau of Economic Research (NBER) - 2003

This paper develops a model of inflation inertia based on optimizing forward looking staggered price setting in a small … open economy. Unlike in current models of sticky prices, transitions to a lower steady state inflation rate take time even … these output losses and the gains from smaller inflationary distortions. For reasonable parameter values inflation …

Persistent link: https://www.econbiz.de/10005778361