Bleaney, Michael F.; Bougheas, Spiros; Skamnelos, Ilias - University <Nottingham> / Department of Economics; … - 2004
A second-generation model of currency crises is combined with a standard model ofbanks as providers of insurance against liquidity risk. In a pegged exchange rateregime, after funds have been committed to the banks, news arrives about the qualityof the banks’ assets and about the exchange rate...