Fundamentals versus external shocks

Brazil's growing exposure to currency crises

M. L F Silva, Joaquim Pinto De Andrade, Thomas S. Torrance

    Research output: Contribution to journalArticle

    Abstract

    While financial globalization does not lack theoretical economic merit, the more far-reaching practical consequences of this phenomenon are often not fully appreciated from the vantage point of North America or the European Union. In particular, globalization can make it more difficult for emerging economies to achieve macroeconomic stabilization. This is especially true if the countries in question have chosen the vehicle of pegged exchange rates as an important element of domestic anti-inflation policy. The chief macroeconomic difficulties for emerging economies in a world of volatile capital flows can include a loss of monetary control, a real appreciation of the domestic currency, and a worsening of economic fundamentals leading to damaging currency crises. This paper concentrates on the recent experience of Brazil as illustrative of the abject plight faced by many developing countries attempting to secure economic stabilization against the background of the present globalized international economy. (JEL G15, 010, 050).

    Original languageEnglish
    Pages (from-to)192-209
    Number of pages18
    JournalInternational Advances in Economic Research
    Volume6
    Issue number2
    Publication statusPublished - May 2000

    Fingerprint

    Economics
    Emerging economies
    Currency crises
    External shocks
    Brazil
    Currency
    Economic fundamentals
    International economy
    Macroeconomic stabilization
    Macroeconomics
    Developing countries
    European Union
    Inflation
    Globalization
    Capital flows
    Exchange rates
    Stabilization
    Financial globalization

    Cite this

    Silva, M. L F ; De Andrade, Joaquim Pinto ; Torrance, Thomas S. / Fundamentals versus external shocks : Brazil's growing exposure to currency crises. In: International Advances in Economic Research. 2000 ; Vol. 6, No. 2. pp. 192-209.
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    Fundamentals versus external shocks : Brazil's growing exposure to currency crises. / Silva, M. L F; De Andrade, Joaquim Pinto; Torrance, Thomas S.

    In: International Advances in Economic Research, Vol. 6, No. 2, 05.2000, p. 192-209.

    Research output: Contribution to journalArticle

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