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International Capital Movements, Financial Volatility and Financial Instability

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  • Frederic S. Mishkin

Abstract

This lecture outlines an asymmetric information theory of financial instability which describes the fundamental forces which harm both the financial sector and economic activity. This asymmetric information framework is then used to demonstrate that although international capital movements and financial volatility can play a role in destabilizing the economy is frequently overstated.

Suggested Citation

  • Frederic S. Mishkin, 1999. "International Capital Movements, Financial Volatility and Financial Instability," NBER Working Papers 6390, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:6390
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    Cited by:

    1. Nabi, Mahmoud Sami, 2001. "Banking Performance and Speculative Attacks Under Asymmetric Information," MPRA Paper 24515, University Library of Munich, Germany.
    2. Martin Schneider & Aaron Tornell, 2004. "Balance Sheet Effects, Bailout Guarantees and Financial Crises," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 71(3), pages 883-913.
    3. Chau H. A. Le, 2016. "Macro-financial linkages and bank behaviour: evidence from the second-round effects of the global financial crisis on East Asia," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 6(3), pages 365-387, December.
    4. Lin, Pei-Chien & Huang, Ho-Chuan (River), 2012. "Banking industry volatility and growth," Journal of Macroeconomics, Elsevier, vol. 34(4), pages 1007-1019.
    5. Eichengreen, Barry, 1998. "International Economic Policy in the Wake of the Asian Crisis," Department of Economics, Working Paper Series qt78c3z577, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    6. Kaufmann, Daniel & Mehrez, Gil & Schmukler, Sergio L., 2005. "Predicting currency fluctuations and crises: Do resident firms have an informational advantage?," Journal of International Money and Finance, Elsevier, vol. 24(6), pages 1012-1029, October.
    7. Gongpil Choi, 2001. "Structural changes and the scope of inflation targeting in Korea," Pacific Basin Working Paper Series 2001-05, Federal Reserve Bank of San Francisco.
    8. De Grauwe, Paul, 2000. "Controls on Capital Flows," Journal of Policy Modeling, Elsevier, vol. 22(3), pages 391-405, May.
    9. Eichengreen, Barry, 1998. "International Economic Policy in the Wake of the Asian Crisis," Department of Economics, Working Paper Series qt78c3z577, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    10. Zhang, Xingmin & Zhang, Shuai & Lu, Liping, 2022. "The banking instability and climate change: Evidence from China," Energy Economics, Elsevier, vol. 106(C).
    11. Aaron Tornell, 2003. "Soft Landings (February 2000), with Martin Schneider," UCLA Economics Online Papers 241, UCLA Department of Economics.
    12. Percival Pineda, 2017. "Financial liberalization and private sector borrowing in ASEAN 4 economies 1990–2012," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 7(2), pages 277-295, August.
    13. Sebastian Edwards, 1999. "Crisis Prevention: Lessons from Mexico and East Asia," NBER Working Papers 7233, National Bureau of Economic Research, Inc.
    14. Heike Joebges, 2000. "Ursachen für die Häufung von "Zwillingskrisen" in Schwellenländern," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 69(1), pages 38-52.

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    More about this item

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • F3 - International Economics - - International Finance

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