The Corporate Sector Dynamics of Systemic Financial Crises

June 1, 2000

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Format: Chicago

Mark R. Stone The Corporate Sector Dynamics of Systemic Financial Crises, (USA: International Monetary Fund, 2000) accessed December 22, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper puts together a set of stylized facts of the corporate sector dynamics of systemic financial crises based on recent crisis episodes with a view to identifying the key issues and their policy implications. The evidence suggests that corporate crisis dynamics arc triggered by a cutoff of capital inflows and are amplified into an historically severe recession by exchange rate depreciation, high interest rates, and current account adjustment. The adverse consequences of these dynamics can be forestalled and assuaged by policies that improve monitoring of the corporate sector and boost nonbank sources of corporate financing.

Subject: Balance of payments, Capital inflows, Corporate sector, Economic sectors, Financial crises, Financial statements, Public financial management (PFM), Systemic crises

Keywords: A. crisis dynamics, Bank, Bank dominance, Capital inflows, Commercial paper, Corporate restructuring, Corporate sector, Credit crunch, Crisis, Crisis dynamics, Crisis episode, Crisis prevention policy, Crisis-prevention externality, East Asia, Financial crises, Financial statements, Financing, Monetary policy, Nominal exchange rate, Nonbank capital markets, Rate of return, Systemic crises, Trough month, WP

Publication Details

Pages:

43
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2000/114
Stock No:

WPIEA1142000
ISBN:

9781451853780
ISSN:

1018-5941

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