In Chapter 2 of this book, I noted that the twin crises in Indonesia and Malaysia are examples of a phenomenon that has become common as emerging market economies have opened their borders to capital flows and privatized their financial sectors. Nothing in my theory, however, is specific to Southeast Asia during the Asian Financial Crisis. Can this theory help us to make sense of financial crises, economic adjustment, and regime survival elsewhere in the world?

In this chapter, I show that it can. My theory uncovers two fundamental regularities in the politics of twin crises. First, coalitional politics determines adjustment policy. By taking seriously the preferences of supporters of autocratic regimes across the world, we can understand adjustment policies in a wide range of authoritarian regimes. Second, preferences for adjustment are at the heart of political conflict over autocratic regime survival. I demonstrate empirically that regimes that impose capital account restrictions during twin crises are more likely to survive these crises than regimes that do not. This finding holds up across countries and when controlling for alternative explanations for regime breakdown. These findings each lend crucial support to the theory that I derived from the experiences of Indonesia and Malaysia, and they reassure us that their experiences are indicative of a larger trend across the world, one that until now has escaped the notice of political scientists.

The methodology employed in this chapter differs from that used elsewhere in this book. Here, I focus on large-n quantitative analyses complemented by briefer case studies.