Though currency and debt crises quite often occur simultaneously, the links between these two types of crises are not well understood. We review how currency and debt crises could be related due to (1) common causes, (2) internal contagion effects from one crisis to the other, and (3)...

Political misalignment and greater ideological distance between donor and recipient governments may render foreign aid less effective by adding to transaction costs and eroding trust. In addition, development aid from the West may lead to adverse growth effects in the global South due to the...