A gravity model of sovereign lending: trade, default and credit

One reason why countries service their external debts is the fear that default might lead to shrinkage of international trade. If so, then creditors should systematically lend more to countries with which they share closer trade links. We develop a simple theoretical model to capture this intuition, then test and corroborate this idea.

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Year of publication:	2002
Authors:	Rose, Andrew K. ; Spiegel, Mark M.
Institutions:	Federal Reserve Bank of San Francisco
Subject:	International trade \| Credit \| Risk

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Extent:	application/pdf
Series:	Working Papers in Applied Economic Theory.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 2002-09
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005401574