TY  - JOUR
AU  - Bordo,Michael D.
AU  - Hargreaves,David
AU  - Kida,Mizuho
TI  - Global shocks, economic growth and financial crises: 120 years of New Zealand experience
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 16027
PY  - 2010
Y2  - May 2010
UR  - http://www.nber.org/papers/w16027
L1  - http://www.nber.org/papers/w16027.pdf
N1  - Author contact info:
Michael D. Bordo
Department of Economics
Rutgers University
New Jersey Hall
75 Hamilton Street
New Brunswick, NJ 08901
Tel: 732/822-7152
Fax: 732/932-7416
E-Mail: bordo@econ.rutgers.edu

David Hargreaves
Reserve Bank of New Zealand
P.O. Box 2498, Wellington
New Zealand
E-Mail: David.Hargreaves@rbnz.govt.nz

Mizuho Kida
Reserve Bank of New Zealand
P.O. Box 2498, Wellington
New Zealand
E-Mail: RBNZ-INFO2@rbnz.govt.nz
AB  - We identify the timing of currency, banking crises and sudden stops in New Zealand from 1880 to 2008, and consider the extent to which empirical models can explain New Zealand’s crisis history.  We find that the cross country evidence on the determinants of crises fits New Zealand experience reasonably well. A number of the risk factors that correlate with crises internationally–such as domestic imbalances, external debt, and currency mismatches–were elevated for New Zealand when the country had more frequent crises and have improved in the recent (more stable) period.  However, a time-series analysis of New Zealand growth over 120 years shows that global factors–such as the US growth rate and terms of trade–explain New Zealand growth fairly well, and that crisis dummy variables do not have significant additional explanatory power. This suggests that having sound institutions and policies may help avoid severe domestic crises, but will not be sufficient to avoid the domestic economic impact of the global business cycle.
ER  -