How we can define financial crises?

Post date: Apr 10, 2013 4:28:47 PM

Definition by Reinhart and Rogoff (2011)

1.Bank runs that lead to the closure, merging, or takeover by the public sector of one or more financial institutions or

2.If there are no runs, the closure, merging, takeover, or large-scale government assistance of an important financial institutions

Other definition by Gorton and Metrick (2011)

∙ A financial crisis is a breakdown in financial intermediation: a significant reduction in the efficient flow of saving into investment.