This paper contributes to the current literature on market disciplining of the sovereign governments in two ways: Firstly, it distinguishes both sides of the market discipline hypothesis (MDH) by adopting 3SLS to incorporate the contemporaneous feedback effects between primary structural budget...

This paper compares the effectiveness of market discipline mechanisms in the banking sector before and after the 2001 financial crisis in Turkey. It employs an empirical model that incorporates the contemporaneous feedback effects between deposits growth rate and the implicit interest rate....

This paper empirically investigates the effect of net external debt holdings on the size of medium-term current account balances. It utilizes an approach where net external debt holdings behave like a "shadow interest rate" in affecting the current account imbalances. This paper has four major...

By modelling the current account balances (as a percentage of GDP) in a dynamic AR(1) model, Taylor (2002) proposed to use speed of mean reversion of the dynamics of the current account as a tool for measurement of capital mobility and confirmed the stylized fact of U-Shape degree of capital...