The efficiency of early warning indicators for financial crises The banking and currency crises of the last two decades inflicted substantial financial economic and social damage on the countries in which they originated. In this work the efficiency of early warning indicators for these disastrous economic events is evaluated. An analysis of the traditional and recent literature on currency crises is performed in order to extract potential early warning indicators that are suggested by theory. Alongside others these candidate indicators are tested in alternative empirical studies that are reviewed in this work. The results are mixed but somewhat encouraging for further research in this field. Furthermore the analysis is extended to a critique of systems of early warning indicators currently used by international institutions.