Capital inflows, crisis and recovery in small open economies
We compare two small open economics, Iceland and Ireland, that experienced a capital inflow through their banking systems in the period preceding the 2008 financial crises but differ in their currency arrangements. Both countries have mostly recovered from their respective crises, but the difference...
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2018
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ftalborgunivpubl:oai:pure.atira.dk:publications/f91dcc56-28ed-446b-9b45-307fe3282fbc 2024-09-15T18:13:38+00:00 Capital inflows, crisis and recovery in small open economies Raza, Hamid Zoega, Gylfi Kinsella, Stephen 2018 https://vbn.aau.dk/da/publications/f91dcc56-28ed-446b-9b45-307fe3282fbc https://doi.org/10.1016/j.frl.2018.03.011 https://www.sciencedirect.com/science/article/pii/S1544612318300941 eng eng https://vbn.aau.dk/da/publications/f91dcc56-28ed-446b-9b45-307fe3282fbc info:eu-repo/semantics/closedAccess Raza , H , Zoega , G & Kinsella , S 2018 , ' Capital inflows, crisis and recovery in small open economies ' , Finance Research Letters , vol. 27 , pp. 273-282 . https://doi.org/10.1016/j.frl.2018.03.011 Demand compression Real exchange rates Sudden stop article 2018 ftalborgunivpubl https://doi.org/10.1016/j.frl.2018.03.011 2024-08-06T23:52:00Z We compare two small open economics, Iceland and Ireland, that experienced a capital inflow through their banking systems in the period preceding the 2008 financial crises but differ in their currency arrangements. Both countries have mostly recovered from their respective crises, but the differences in the way their economies adjusted are interesting. The evidence suggests that changes in the real exchange rate served as the adjusting mechanism for Iceland's current account while in Ireland domestic demand compression served as the main adjustment mechanism. We also explore the adjustment to the crisis in three other Eurozone economies and find that they were similar to the one in Ireland. Article in Journal/Newspaper Iceland Aalborg University's Research Portal Finance Research Letters 27 273 282 |
institution |
Open Polar |
collection |
Aalborg University's Research Portal |
op_collection_id |
ftalborgunivpubl |
language |
English |
topic |
Demand compression Real exchange rates Sudden stop |
spellingShingle |
Demand compression Real exchange rates Sudden stop Raza, Hamid Zoega, Gylfi Kinsella, Stephen Capital inflows, crisis and recovery in small open economies |
topic_facet |
Demand compression Real exchange rates Sudden stop |
description |
We compare two small open economics, Iceland and Ireland, that experienced a capital inflow through their banking systems in the period preceding the 2008 financial crises but differ in their currency arrangements. Both countries have mostly recovered from their respective crises, but the differences in the way their economies adjusted are interesting. The evidence suggests that changes in the real exchange rate served as the adjusting mechanism for Iceland's current account while in Ireland domestic demand compression served as the main adjustment mechanism. We also explore the adjustment to the crisis in three other Eurozone economies and find that they were similar to the one in Ireland. |
format |
Article in Journal/Newspaper |
author |
Raza, Hamid Zoega, Gylfi Kinsella, Stephen |
author_facet |
Raza, Hamid Zoega, Gylfi Kinsella, Stephen |
author_sort |
Raza, Hamid |
title |
Capital inflows, crisis and recovery in small open economies |
title_short |
Capital inflows, crisis and recovery in small open economies |
title_full |
Capital inflows, crisis and recovery in small open economies |
title_fullStr |
Capital inflows, crisis and recovery in small open economies |
title_full_unstemmed |
Capital inflows, crisis and recovery in small open economies |
title_sort |
capital inflows, crisis and recovery in small open economies |
publishDate |
2018 |
url |
https://vbn.aau.dk/da/publications/f91dcc56-28ed-446b-9b45-307fe3282fbc https://doi.org/10.1016/j.frl.2018.03.011 https://www.sciencedirect.com/science/article/pii/S1544612318300941 |
genre |
Iceland |
genre_facet |
Iceland |
op_source |
Raza , H , Zoega , G & Kinsella , S 2018 , ' Capital inflows, crisis and recovery in small open economies ' , Finance Research Letters , vol. 27 , pp. 273-282 . https://doi.org/10.1016/j.frl.2018.03.011 |
op_relation |
https://vbn.aau.dk/da/publications/f91dcc56-28ed-446b-9b45-307fe3282fbc |
op_rights |
info:eu-repo/semantics/closedAccess |
op_doi |
https://doi.org/10.1016/j.frl.2018.03.011 |
container_title |
Finance Research Letters |
container_volume |
27 |
container_start_page |
273 |
op_container_end_page |
282 |
_version_ |
1810451400305410048 |