Las secuelas de las crisis financieras

Reinhart, Carmen and Rogoff, Kenneth (2008): Las secuelas de las crisis financieras.

Abstract

This paper examines the depth and duration of the slump that invariably follows severe financial crises, which tend to be protracted affairs. We find that asset market collapses are deep and prolonged. On a peak-to-trough basis, real housing price declines average 35 percent stretched out over six years, while equity price collapses average 55 percent over a downturn of about three and a half years. Not surprisingly, banking crises are associated with profound declines in output and employment. The unemployment rate rises an average of 7 percentage points over the down phase of the cycle, which lasts on average over four years. Output falls an average of over 9 percent, although the duration of the downturn is considerably shorter than for unemployment. The real value of government debt tends to explode, rising an average of 86 percent in the major post–World War II episodes. The main cause of debt explosions is usually not the widely cited costs of bailing out and recapitalizing the banking system. The collapse in tax revenues in the wake of deep and prolonged economic contractions is a critical factor in explaining the large budget deficits and increases in debt that follow the crisis. Our estimates of the rise in government debt are likely to be conservative, as these do not include increases in government guarantees, which also expand briskly during these episodes.

• Item Type: MPRA Paper
• English Title: The aftermath of financial crisis
• Language: Spanish
• Keywords: crisis financiera desempleo deuda publica
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook; E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles

References

Calvo, Guillermo A., Alejandro Izquierdo, and Rudy Loo-Kung. 2006. “Relative Price Volatility Under Sudden Stops: The Relevance of Balance Sheet Effects.” Journal of International Economics Vol. 9 No. 1: 231–254. [Volatilidad relativa en los precios en Paradas Repentinas: la Relevancia de los Efectos de los Balances]

International Monetary Fund. 2002. World Economic Outlook. Washington DC: International Monetary Fund. [Panorama Económico Mundial]

Reinhart, Carmen M., and Kenneth S. Rogoff. 2008a. “Is the 2007 U.S. Subprime Crisis So Different? An International Historical Comparison.” American Economic Review Vol. 98 No. 2: 339–344. [¿Es la crisis subprima USA 2007 tan distinta? Una comparación histórica internacional]

Reinhart, Carmen M., and Kenneth S. Rogoff. 2008b. “Banking Crises: An Equal Opportunity Menace.” National Bureau of Economic Research Working Paper 14587. [Crisis bancarias: una amenaza con igualdad de oportunidades]