Banking, currency, stock market and debt crises: revisiting reinhart & rogoff debt analysis in Spain, 1850-1995

  1. Emma Iglesias
  2. Joan Carles Maixé Altés
Revista:
Notas técnicas: [continuación de Documentos de Trabajo FUNCAS]

ISSN: 1988-8767

Año de publicación: 2016

Número: 774

Tipo: Documento de Trabajo

Otras publicaciones en: Notas técnicas: [continuación de Documentos de Trabajo FUNCAS]

Resumen

What type of crisis is generated when debt increases? We study the Spanish debt evolution in the 19th and 20th centuries by introducing currency and stockmarket crises in the Reinhart and Rogoff (2011) framework. We find their same results for the determinants of banking and debt crises but substituting external and public debt with perpetual debt. Moreover, we find that currency crises depend strongly and positively on financial centers crises and negatively and mildly on perpetual debt. We justify the negative relationship due to an inflation tax. We also find that stock-market crises depend only positively and strongly on financial centers crises.