one-period debt and can renege on its obligations by suffering a stochastic default cost. When faced with a credible … default threat, creditors can make a take-it-or-leave-it debt haircut offer to the sovereign. The risk of renegotiation is …

assess and price the risk of default. In order to analyse default risk in the macroeconomy, a simple general equilibrium … model with banks and financial intermediation is constructed in which default-risk can be priced. It is shown how the credit … spread can be attributed largely to the risk of default and how excess loan creation may emerge due different attitudes to …

default induced redistribution and costs due to income losses in the wake of a default. Their choice of short- versus long …-term debt affects default and rollover decisions by subsequent policy makers. The equilibrium maturity structure is shaped by … low, or a cross default more likely. These predictions are consistent with empirical evidence. …

over the period 1982–1999. The recovery rates are measured using the prices of defaulted securities at the time of default … and at the time of emergence from default or from bankruptcy. In addition to seniority and security of the defaulted … securities, industry conditions at the time of default are found to be robust and important determinants of the recovery rates …

report evidence of significant incremental information revelation in the credit default swap (CDS) market, consistent with …

This paper analyses whether sovereign default episodes can be seen as contingencies of optimal international lending …

This Paper estimates the effect of sovereign debt renegotiation on international trade. Sovereign default may be … associated with a subsequent decline in international trade either because creditors want to deter default by debtors, or because … trade finance dries up after default. To estimate the effect, I use an empirical gravity model of bilateral trade and a …