International Trade and Finance Association Working Papers 2008
Capital Account Liberalization and Currency Crisis – The Case of Central Eastern European CountriesMalgorzata Sulimierska, Economics Department, University of Sussex I would like to thank Ryszard Kokoszczynski (National Bank of Poland), Carolun Stumph (Indiana University Purdue University Fort Wayne) and Robert Eastwood (Unniversity of Sussex) for their comments and support. I am also grateful to participants of the International Trade and Finance Association's Eighteenth International Conference in Lisbon Download the Paper (PDF format) - October 7, 2008 Tell a colleague about it. Printing Tips: Select 'print as image' in the Acrobat print dialog if you have trouble printing. ABSTRACT: The dissertation investigates if Central and Eastern European countries with unregulated capital flows are more vulnerable to currency crises. In order to answer this question properly the paper considers two lines of analysis: single-country and multi-country. Single –country studies look into three cases: Russia, Poland and Latvia. The multi-country analysis is the simple adaptation of Glick, Guo and Hutchison’s probit panel model (2004). The results suggest that countries with liberalized capital accounts experience a lower likelihood of currency crises. Moreover, the information from case studies pointed that the speed and sequence of the CAL process needs to be adequate for the country development. This paper, co-winner of the best student paper award, was presented at the 18th International Conference of the International Trade and Finance Association, meeting at Universidade Nova de Lisboa, May 22, 2008. SUGGESTED CITATION:
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