Tahirih

Short story by Leah Kaminsky.This project is supported by the Victorian Government through Arts Victoria, and by the Australian Government through the Australia Council, its arts funding and advisory body

International Capital Flows, Financial Stability and Growth

The explosion and dramatic reversal of capital flows to emerging markets in the 1990s have ignited a heated debate, with many arguing that globalization has gone too far and that international capital markets have become extremely erratic. In contrast, others have emphasized that globalization allows capital to move to its most attractive destination, fuelling higher growth. This paper re-examines the characteristics of international capital flows since 1970 and summarizes the findings of research of the 1990s on the behaviour of international investors as well as the short- and long-run effects of globalization on financial markets and growth.international capital flows, globalization, mutual funds, stock market prices, financial liberalization.

Toxicology of atmospheric degradation products of selected hydrochlorofluorocarbons

Trifluoroacetic acid (TFA) is a liquid with a sharp biting odor. It has been proposed as the product of environmental degradation of the hydrochlorofluorocarbons HCFC-123, HCFC-124, HFC-134a, and HFC-125. Compounds HCFC-141b and HCFC-142b could yield mixed fluorochloroacetic acids, for which there is no available toxicologic data. The release of hydrochlorofluorocarbons into the environment could also give rise to HF, but the additional fluoride burden (1 to 3 ppb) in rainwater is trivial compared to levels in fluoridated drinking water (1 ppm), and would provide an insignificant risk to humans. Thus, in this paper only the toxocologic data on TFA is reviewed to assess the potential risks of environmental exposure

Varieties of Currency Crises

The plethora of currency crises around the world has fueled many theories on the causes of speculative attacks. The first-generation models focus on fiscal problems. The second-generation models emphasize countercyclical policies and self-fulfilling crises. In the 1990s, models pinpoint to financial excesses. With the crisis of Argentina in 2001, models of sovereign default have become popular again. While the theoretical literature has emphasized variety, the empirical literature has supported the one size fits all' models. This paper contributes to the empirical literature by assessing whether the crises of the last thirty years are of different varieties. Crises are found to be of six varieties. Four of those varieties are associated with domestic economic fragility. But crises can also be provoked by just adverse world market conditions, such as the reversal of international capital flows. The so-called sudden-stop phenomenon identifies the fifth variety of crises. Finally, a small number of crises occur in economies with immaculate fundamentals but this type of crises is not an emerging-market phenomenon.

Crises and Sudden Stops: Evidence from International Bond and Syndicated-Loan Markets

The crises in Mexico, Thailand, and Russia in the 1990s spread quite rapidly to countries as far apart as South Africa and Pakistan. In the aftermath of these crises, many emerging economies lost access to international capital markets. Using data on international primary issuance, this paper studies the determinants of contagion and sudden stops following those crises. The results indicate that contagion and sudden stops tend to occur in economies with financial fragility and current account problems. They also show that high integration in international capital markets exposes countries to sudden stops even in the absence of domestic vulnerabilities.Contagion; Financial integration; Globalization; International primary issuance; Sudden stops

On crises, contagion, and confusion

Since the Tequila crisis of 1994-95, the Asian flu of 1997, and the Russian virus of 1998, economists have been busy producing research on the subject of contagion. Yet, few studies have examined empirically through which channels the disturbances are transmitted if there are, indeed, fundamental reasons for the spillovers we observe. We attempt to fill this gap by analyzing how both trade links and the largely ignored financial sector links influence the pattern of fundamentals-based contagion. We examine the role of international bank lending, the potential for cross-market hedging, and bilateral and third-party trade in the propagation of crises.trade financial contagion bank lending currency crisis devaluation

The twin crises: The causes of banking and balance of payments problems

In the wake of the Mexican and Asian currency turmoil, the subject of financial crises has come to the forefront of academic and policy discussions. This paper analyzes the links between banking and currency crises. We find that: problems in the banking sector typically precede a currency crisis--the currency crisis deepens the banking crisis, activating a vicious spiral; financial liberalization often precedes banking crises. The anatomy of these episodes suggests that crises occur as the economy enters a recession, following a prolonged boom in economic activity that was fueled by credit, capital inflows and accompanied by an overvalued currency.banking crises credit currency crash stock prices capital flows exports recession

Short and long-run integration : do capital controls matter ?

The authors study whether capital controls affect the link between domestic and foreign stock market prices and interest rates. To examine the characteristics of international market integration and the effects of capital controls in the short and long run, they apply band-pass filter techniques to data from six emerging economics during the 1990s. They find that markets seem to be linked more at longer horizons. Equity prices seem to be more connected internationally than interest rates. They also find little evidence that controls effectively segment domestic markets from foreign markets. And when they do, the effects seem to be short-lived. Moreover, the effects of controls on outflows do not seem to differ from those of controls on inflows. For example, controls on outflows in Venezuela during the 1994 crisis, and unremunerated reserve requirements in Chile and Colombia during a capital-inflow episode, seem to have shielded domestic markets at the most at very high frequencies. The degree of financial sophistication does not seem to affect the authors'conclusion on the insulation provided by capital controls. True, more developed financial markets, such as those in Brazil, are more closely linked to international markets than those in Colombia and Venezuela, which are far more illiquid. But capital controls do not seem to provide an extra cushion against international spillovers even in less developed markets.Economic Theory&Research,Capital Markets and Capital Flows,International Terrorism&Counterterrorism,Fiscal&Monetary Policy,Banks&Banking Reform,Economic Theory&Research,Banks&Banking Reform,Macroeconomic Management,Financial Economics,International Terrorism&Counterterrorism