Financial Crises and Economic Activity

38 Pages Posted: 28 Sep 2009 Last revised: 11 Jul 2010

See all articles by Stephen G. Cecchetti

Stephen G. Cecchetti

Brandeis International Business School; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Marion Kohler

Bank for International Settlements (BIS)

Christian Upper

Bank for International Settlements (BIS)

Multiple version iconThere are 2 versions of this paper

Date Written: September 2009

Abstract

We study the output costs of 40 systemic banking crises since 1980. Most, but not all, crises in our sample coincide with a sharp contraction in output from which it took several years to recover. Our main findings are as follows. First, the current financial crisis is unlike any others in terms of a wide range of economic factors. Second, the output losses of past banking crises were higher when they were accompanied by a currency crisis or when growth was low at the onset of the crisis. When accompanied by a sovereign debt default, a systemic banking crisis was less costly. And, third, there is a tendency for systemic banking crises to have lasting negative output effects.

Suggested Citation

Cecchetti, Stephen G. and Kohler, Marion and Upper, Christian, Financial Crises and Economic Activity (September 2009). NBER Working Paper No. w15379. Available at SSRN: https://ssrn.com/abstract=1478797

Stephen G. Cecchetti (Contact Author)

Brandeis International Business School ( email )

415 South Street
Waltham, MA 02453
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
212-720-8629 (Phone)
212-720-2630 (Fax)

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Marion Kohler

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

Christian Upper

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

Register to save articles to
your library

Register

Paper statistics

Downloads
97
Abstract Views
1,197
rank
259,953
PlumX Metrics