50 Pages Posted: 3 Oct 1996
Date Written: July 1996
This paper is concerned with the fact that the incidence of speculative attacks tends to be temporally correlated; that is, currency crises appear to pass contagiously from one country to another. The paper provides a survey of the theoretical literature, and analyzes the contagious nature of currency crises empirically. Using thirty years of panel data from twenty industrialized countries, we find evidence of contagion. Contagion appears to spread more easily to countries which are closely tied by international trade linkages than to countries in similar macroeconomic circumstances.
Suggested Citation: Suggested Citation
Eichengreen, Barry and Rose, Andrew Kenan and Wyplosz, Charles, Contagious Currency Crises (July 1996). NBER Working Paper No. w5681. Available at SSRN: https://ssrn.com/abstract=4281