Home  About us  Contact
 

External Debt (external + debt)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting57%
Humanities and Social Sciences42%
Distribution within Business, Economics, Finance and Accounting
General & Introductory Economics49%

Selected Abstracts

The Prospects for Foreign Debt Sustainability in Post-Completion-Point Countries: Implications of the HIPC-MDRI Framework

DEVELOPMENT POLICY REVIEW, Issue 2 2008
Jacinta Nwachukwu
The Enhanced HIPC Initiative was launched in 1999 to reduce the Net Present Value (NPV) of foreign debt of the world's poorest countries to a sustainable threshold of 150% of their exports. This article applies a simple growth-with-debt model to 16 post-completion-point HIPCs to assess whether this goal will be met by 2015. Its somewhat optimistic base-case projections suggest that participation in the current Enhanced HIPC-MDRI initiative will only reduce the NPV of their total external debt to 176% of exports by this date. Sensitivity tests which expose these countries to adverse exogenous shocks help draw attention to policies that could ensure that they do not again accumulate unsustainable debt levels. [source]

Will there be a dollar crisis?

ECONOMIC POLICY, Issue 51 2007
Paul Krugman
SUMMARY Will there be a dollar crisis? Almost everyone believes that the US current account deficit must eventually end, and that this end will involve dollar depreciation. However, many believe that this depreciation will take place gradually. This paper shows that any process of gradual dollar decline fast enough to prevent the accumulation of implausible levels of US external debt would impose capital losses on investors much larger than they currently expect. As a result, there will at some point have to be a ,Wile E. Coyote moment', a point at which expectations are revised, and the dollar drops sharply. It is much less clear, however, whether this ,crisis' will produce macroeconomic problems. , Paul Krugman [source]

Debt management in Brazil: evaluation of the real plan and challenges ahead

INTERNATIONAL JOURNAL OF FINANCE & ECONOMICS, Issue 1 2002
Afonso S. Bevilaqua
Abstract The Brazilian domestic debt has posed two challenges to policy-makers: it has grown very fast and its maturity is extremely short. This has prompted fears that a default or a compulsory lengthening scheme would be imposed. Here, we analyse the domestic public debt management experience in Brazil, searching for policy prescriptions for the next few years. After briefly reviewing the recent domestic public debt history, we decompose the large rise in federal bonded debt during 1995,2000, searching for its macroeconomic causes. The main culprits are the extremely high interest payments,which, until 1998, were caused by the weak fiscal stance and the quasi-fixed exchange-rate regime; and since 1999, by the impact of the currency depreciation on the dollar-indexed and the external debt,, and the accumulation of assets of doubtful value, much of which may have to be written off in the future. Simulation exercises of the net debt path for the near future underscore the importance of a tighter fiscal stance to prevent the debt-GDP ratio from growing further. Given the need to quickly lengthen the debt maturity, our main policy advice is to foster, and rely more on, inflation-linked bonds. Copyright © 2002 John Wiley & Sons, Ltd. [source]

The Political Economy of Pension Reform in Eastern Europe

INTERNATIONAL SOCIAL SECURITY REVIEW, Issue 2-3 2001
Katharina Müller
The retirement schemes in several East European countries underwent fundamental change in recent years, defying conventional wisdom in welfare state research. This article takes a new look at the determinants of paradigm choice in the area of old-age security, comparing the Polish, Hungarian and Czech experience from an actor-centred institutionalist perspective. The author points out that structural factors , notably the financial situation of retirement schemes and the level of external debt , largely determined the set of main pension reform actors, as well as their relative strength. The resulting actor constellations produced the basic paradigm choice, based on the actors' respective cognitive maps and consequent perception of pension reform alternatives. Tactical moves and the strategic potentialities of the chosen paradigm were also relevant. [source]

Bringing"The Gospel of Modernization"to Nigeria: American Nation Builders and Development Planning in the 1960s

PEACE & CHANGE, Issue 3 2006
Larry Grubbs
Drawing on recent studies of development discourse, this essay explores the impact of two American academics affiliated with the Massachusetts Institute of Technology on Nigerian economic planning in the 1960s. Their published and unpublished writings provide a dramatic demonstration of how development discourse skewed American and Nigerian perceptions of reality, contributing to the failure of nation building during the First Republic. American "secular missionaries" promoted a "gospel of modernization," a vision of Nigeria as a self-confident, unified nation-state that would offer Africa a model for development. They predicted the Nigerian National Development Plan of 1962,68, funded by American aid and private investment, would provide a "significant historical demonstration" that American-led modernization produces development and democracy. Instead, Nigeria's economy remained locked into neocolonial trade patterns, corruption blossomed, and ethnic conflict and political opportunism culminated in a bloody civil war from 1967 to 1970. Nigeria entered the twenty-first century with a staggering external debt, widespread poverty, and painful dependence on the West. [source]

A Multinational Perspective on Capital Structure Choice and Internal Capital Markets

THE JOURNAL OF FINANCE, Issue 6 2004
MIHIR A. DESAI
ABSTRACT This paper analyzes the capital structures of foreign affiliates and internal capital markets of multinational corporations. Ten percent higher local tax rates are associated with 2.8% higher debt/asset ratios, with internal borrowing being particularly sensitive to taxes. Multinational affiliates are financed with less external debt in countries with underdeveloped capital markets or weak creditor rights, reflecting significantly higher local borrowing costs. Instrumental variable analysis indicates that greater borrowing from parent companies substitutes for three-quarters of reduced external borrowing induced by capital market conditions. Multinational firms appear to employ internal capital markets opportunistically to overcome imperfections in external capital markets. [source]

Country Default Risk: An Empirical Assessment

AUSTRALIAN ECONOMIC PAPERS, Issue 4 2001
Jerome L. Stein
We provide benchmarks to evaluate what is an optimal foreign debt and a maximal foreign debt (debt-max), when risk is explicitly considered. When the actual debt exceeds debt-max, then the economy will default when a ,bad shock' occurs. This paper is an application of the stochastic optimal controls models of Fleming and Stein (2001), which gives empirical content to the question of how one should measure ,vulnerability' to shocks, when there is uncertainty concerning the productivity of capital. We consider two sets of high-risk countries during the period 1978,99: a subset of 21 countries that defaulted on the debt, and another set of 13 countries that did not default. Default is a situation where the firms or government of a country reschedule the interest/principal payments on the external debt. We thereby explain how our analysis can anticipate default risk, and add another dimension to the literature of early warning signals of default/credit risk. [source]