The paper develops a model of seigniorage in an open economy, linking inflation, the government budget and the external balance. It introduces financial markets and interest rates in the traditional Cagan style model of inflationary dynamics and it evaluates the experiences of Brazil and Mexico....

This paper reviews recent developments in the theoretical and empirical analysis of balance-of-payments crises. A simple analytical model highlighting the process leading to such crises is first developed. The basic framework is then extended to deal with a variety of issues, such as:...