scholarly journals Use of Unit Root Methods in Early Warning of Financial Crises

2016 ◽  
Author(s):  
Timo Virtanen ◽  
Eero Tölö ◽  
Matti Viren ◽  
Katja Taipalus
Keyword(s):  
Early Warning ◽  
Unit Root ◽  
Financial Crises ◽  
Root Methods

scholarly journals Use of Unit Root Methods in Early Warning of Financial Crises

2017 ◽  
Author(s):  
Timo Virtanen ◽  
Eero Tölö ◽  
Matti Virén ◽  
Katja Taipalus
Keyword(s):  
Early Warning ◽  
Unit Root ◽  
Financial Crises ◽  
Root Methods

Early warning signals of financial crises using persistent homology

2021 ◽  
pp. 126459
Author(s):  
Mohd Sabri Ismail ◽  
Mohd Salmi Md Noorani ◽  
Munira Ismail ◽  
Fatimah Abdul Razak ◽  
Mohd Almie Alias
Keyword(s):  
Early Warning ◽  
Financial Crises ◽  
Persistent Homology ◽  
Warning Signals ◽  
Early Warning Signals

Predicting Financial Crises in a Globalized World

2018 ◽  
pp. 63-80
Author(s):  
Asli Yuksel Mermod ◽  
Ülkü Yüksel ◽  
Catherine Sutton-Brady
Keyword(s):  
Great Depression ◽  
Early Warning ◽  
Financial Crises ◽  
Banking System ◽  
Lessons Learned ◽  
Warning Signals ◽  
Fundamental Causes ◽  
Liquidity Crises ◽  
Globalized World

This chapter highlights the facts about financial crises and their fundamental causes on specific incidents, including the 1929 Great Depression that lasted until the early-1940s, 1997 Asian Financial Crises, 1998 Russian Financial Crises, and the Liquidity Crises of 2008, and makes a comparison among them and their various outcomes. In doing so, the study specifies the cues that emerge in the financial system that may help governments predict upcoming financial crises through those early warning signals. This case study specifically analyses the Turkish Banking System that was restructured after the enormous financial crises in Turkey in 2001, which caused many Turkish banks to collapse. However, the precautions taken in the aftermath of the financial turmoil allowed them to survive the liquidity crises in 2008. The indicators of an upcoming crisis are examined, the lessons learned from this case are analyzed, and important recommendations to overcome banking crises are provided.

scholarly journals EFFECTIVENESS OF EARLY WARNING MODELS: A CRITICAL REVIEW AND NEW AGENDA FOR FUTURE DIRECTION

2019 ◽  
Vol 22 (4) ◽  
pp. 457-484
Author(s):  
Rakesh Padhan ◽  
K. P. Prabheesh
Keyword(s):  
Financial Crisis ◽  
Early Warning ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Dynamic Nature ◽  
Explanatory Variables ◽  
History Of ◽  
Central Argument ◽  
Future Direction ◽  
The Global Financial Crisis

This paper suggests a new agenda for constructing early warning models (EWMs) toenhance their effectiveness in predicting financial crises. The central argument of thenew agenda aims to eradicate the weaknesses of existing EWMs, since their failure topredict the global financial crisis of 2007–2008 demonstrates the need to improve theirefficiency. We document the history of EWMs and propose a new agenda as follows:1) the accurate measurement of a financial crisis, 2) implementation of a fourthgenerationcrisis model to capture the dynamic nature of the financial crisis, and 3) theinclusion of interconnectedness/contagion variables as explanatory variables for thefinancial crisis.

Early Warning System for Financial Crises

2018 ◽  
pp. 1-25 ◽  
Author(s):  
Amir Manzoor
Keyword(s):  
Financial Crisis ◽  
Early Warning ◽  
Financial Crises ◽  
Early Warning System ◽  
Financial Stability ◽  
Time Horizon ◽  
Warning System ◽  
False Alarms ◽  
Financial Risks ◽  
Policy Makers

To maintain financial stability, prevention of financial crisis is very important. This prevention is especially is especially important for developing countries where we need robust instruments for prediction of financial crises. One such instrument is Early Warning System (EWS). An EWS provided signals that could reflect the likelihood of a financial crisis over a given time horizon. Changing nature of financial risks due to liberalization of economies has increased the importance of an effective EWS. This chapter explores the state of the art of EWS. It is suggested that policy makers should take into account their objectives and related thresholds of various while developing an EWS since there exists a sharp trade-off between correctly calling crises and false alarms.

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