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Article: The role of (non-)transparency in a currency crisis model
Title | The role of (non-)transparency in a currency crisis model |
---|---|
Authors | |
Keywords | Common Knowledge Currency Crisis Multiple Equilibria Transparency |
Issue Date | 2002 |
Publisher | Elsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/eer |
Citation | European Economic Review, 2002, v. 46 n. 2, p. 397-416 How to Cite? |
Abstract | This paper extends the work by Morris and Shin (Am. Econom. Rev. 88 (1998) 587-597) where multiple equilibria in the self-fulfilling currency attack models can be reduced to a unique equilibrium when agents observe fundamentals privately with small errors. We find that under a more general specification with realistic parameters, noisy private observations are generally insufficient to prevent the multiplicity of equilibria. The pivotal role played by the transparency of fundamentals/policies in currency crisis is also examined. Surprisingly, transparency may trigger rather than eliminate currency crises when fundamentals are relatively healthy. Our results may be relevant to research in other coordination problems. © 2002 Elsevier Science B.V. All rights reserved. |
Persistent Identifier | http://hdl.handle.net/10722/177693 |
ISSN | 2023 Impact Factor: 2.8 2023 SCImago Journal Rankings: 2.251 |
ISI Accession Number ID | |
References |
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Chan, KS | en_US |
dc.contributor.author | Chiu, YStephen | en_US |
dc.date.accessioned | 2012-12-19T09:39:33Z | - |
dc.date.available | 2012-12-19T09:39:33Z | - |
dc.date.issued | 2002 | en_US |
dc.identifier.citation | European Economic Review, 2002, v. 46 n. 2, p. 397-416 | en_US |
dc.identifier.issn | 0014-2921 | en_US |
dc.identifier.uri | http://hdl.handle.net/10722/177693 | - |
dc.description.abstract | This paper extends the work by Morris and Shin (Am. Econom. Rev. 88 (1998) 587-597) where multiple equilibria in the self-fulfilling currency attack models can be reduced to a unique equilibrium when agents observe fundamentals privately with small errors. We find that under a more general specification with realistic parameters, noisy private observations are generally insufficient to prevent the multiplicity of equilibria. The pivotal role played by the transparency of fundamentals/policies in currency crisis is also examined. Surprisingly, transparency may trigger rather than eliminate currency crises when fundamentals are relatively healthy. Our results may be relevant to research in other coordination problems. © 2002 Elsevier Science B.V. All rights reserved. | en_US |
dc.language | eng | en_US |
dc.publisher | Elsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/eer | en_US |
dc.relation.ispartof | European Economic Review | en_US |
dc.subject | Common Knowledge | en_US |
dc.subject | Currency Crisis | en_US |
dc.subject | Multiple Equilibria | en_US |
dc.subject | Transparency | en_US |
dc.title | The role of (non-)transparency in a currency crisis model | en_US |
dc.type | Article | en_US |
dc.identifier.email | Chiu, YStephen: sywchiu@hku.hk | en_US |
dc.identifier.authority | Chiu, YStephen=rp01057 | en_US |
dc.description.nature | link_to_subscribed_fulltext | en_US |
dc.identifier.doi | 10.1016/S0014-2921(01)00143-X | en_US |
dc.identifier.scopus | eid_2-s2.0-0036152224 | en_US |
dc.relation.references | http://www.scopus.com/mlt/select.url?eid=2-s2.0-0036152224&selection=ref&src=s&origin=recordpage | en_US |
dc.identifier.volume | 46 | en_US |
dc.identifier.issue | 2 | en_US |
dc.identifier.spage | 397 | en_US |
dc.identifier.epage | 416 | en_US |
dc.identifier.isi | WOS:000173435200009 | - |
dc.publisher.place | Netherlands | en_US |
dc.identifier.scopusauthorid | Chan, KS=7406032609 | en_US |
dc.identifier.scopusauthorid | Chiu, YStephen=7202775090 | en_US |
dc.identifier.issnl | 0014-2921 | - |