International Financial Crises: Causes, Prevention, and Cures

• Published in: The American economic review Vol. 90; no. 2; pp. 1 - 16
• Main Author: Summers, Lawrence H.
• Format: Journal Article
• Language: English
• Published: Menasha, Wis American Economic Association 01.05.2000
• Subjects: Accident prevention; Banking crises; Banking industry; Bankruptcy laws; Capital mobility; Consumption; Developing countries; Economic benefits; Economic crises; Economic models; Economic policy; Economics; Economists; Efficiency; Finance; Financial economics; Government crises; International economic order; International finance; International financial institutions; International monetary operations; International monetary policy; Investors; LDCs; Management of crises; Market economies; Public officials; Richard T. Ely Lecture; Securities markets; Studies; World economy
• ISSN: 0002-8282; 1944-7981
• DOI: 10.1257/aer.90.2.1

The causes, prevention and cures of international financial crises are examined. Four issues are addressed: 1. what it means to have an efficient financial system, highlighting the important fact that accident prevention is only one aspect of how the system performs, 2. the alternate sources of financial crises in general, and roots of the recent crises in particular, 3. the best ways to design a system, both at the national and the international level, that will work well and more effectively prevent crises, and 4. the question of effective crisis response, both at the level of national policies and the response of the international community.