The financial crisis in Russia

Abstract

In the third quarter of 1998, Russia experienced what seemed a classical financial crisis, combining a currency crisis, a debt crisis and a banking crisis.The Russian crisis was also evidently connected with the earlier Asian crisis, and sent shock waves across global financial markets.Still, a closer look shows that the Russian crisis was mostly home made, typically caused by excessive public sector debt, and the mechanisms of crisis can not be understood without an understanding of the peculiarities of the Russian economic system, including demonetisation and insider ownership.Such factors also go a long way in explaining the emergence of Russia from the crisis. Keywords: Russia - economic development and policies; financial crisis; global financial markets