Causes of banking crises revisited

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Abstract

We examine to what extent there exists heterogeneity in the causes of a banking crisis. For this purpose, we use a random coefficient logit model including 110 countries between 1970 and 2007. We conclude that there exists significant heterogeneity in the causes of a banking crisis. We find that a high credit growth, a negative GDP growth and a high real interest rate are on average the most important causes of a banking crisis. However, none of the variables has a significant impact in more than 60 percent of the banking crises. Besides we find that the impact of the determinants differ between systemic and non-systemic crises and across stages of economic development.
Original languageEnglish
Pages (from-to)72-87
JournalThe North American Journal of Economics and Finance
Volume21
Issue number1
DOIs
Publication statusPublished - 2010

Keywords

  • models

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