Do Indicators of Financial Crises Work ? an Evaluation of an Early Warning System

  title={Do Indicators of Financial Crises Work ? an Evaluation of an Early Warning System},
  author={Hali J. Edison},
  • Hali J. Edison
  • Published 2000
The object of this paper is to develop an operational early warning system (EWS) that can detect financial crises. To achieve this goal the paper analyzes and extends the early warning system developed by Kaminsky, Lizondo, and Reinhart (1998) and Kaminsky and Reinhart (1999) that is based on the "signal" approach. This system monitors several indicators that tend to exhibit an unusual behavior in the periods preceding a crisis. When an indicator exceeds (or falls below) a threshold, then it is… CONTINUE READING
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