Describe the crisis
– Reason of the crisis; main features (6)
– Out of 6 reasons what is more relevant
:
Discuss similarity and difference btw the two crisis.
If there are similarity, reasons to explain similarity?
If there are differences, reasons to explain differences?
Describe the most recent banking/currency/debt crisis (perhaps also hyperinflation) that the country has experienced. Specifically
a. Present some statistics illustrating the severity of the crisis, its duration, and it output costs.
b. Discuss its main origins. List no more than five of the main factors, but focus on the two most important ones. [It may be useful to compare this country with some other similar economies that experienced a crisis during the same period (e.g., East Asian crisis in 1997/1998; Tequila crisis in the mid-1990s; debt crisis of early 1980s; European crisis in the early 1990)].
2. Past Episode
Using the Reinhart and Rogoff chronology or another crisis classification (e.g., Laeven and Valencia, Systemic Banking Crisis Database, IMF Economic Review, 2013) or your knowledge of
history repeat the analysis (steps (a) and (b) above) using an earlier crisis in the same country (e.g., you could compare the 1995 crisis in Mexico with the 1850 default of Mexico). It is particularly important to cite the works or data sources that you use in the historical analysis.
3. Comparison and Persistence
a. Discuss the similarities and differences of the two crises (contemporary with historical). For example are there similar driving forces? Are there similarities and differences on the response to the two crises and how different is the evolution of output?
b. Discuss some mechanisms/channels that may (or may not) explain persistence. For example are there deep origins of both crises or not?