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Structuring and Restructuring Sovereign Debt: The Role of Seniority

Bolton, Patrick; Jeanne, Olivier - C.E.P.R. Discussion Papers - 2005

In an environment characterized by weak contractual enforcement, sovereign lenders can enhance the likelihood of repayment by making their claims more difficult to restructure. We show within a simple model how competition for repayment between lenders may result in sovereign debt that is...

Persistent link: https://www.econbiz.de/10005504677

Sovereign default risk and commitment for fiscal adjustment

Gonçalves, Carlos Eduardo; Guimarães, Bernardo - C.E.P.R. Discussion Papers - 2012

This paper studies fiscal policy in a model of sovereign debt and default. A time-inconsistency problem arises: since the price of past debt cannot be affected by current fiscal policy and governments cannot credibly commit to a certain path of tax rates, debtor countries choose suboptimally low...

Persistent link: https://www.econbiz.de/10011083643

The Greek Debt Restructuring: An Autopsy

Gulati, Mitu; Trebesch, Christoph; Zettelmeyer, Jeromin - C.E.P.R. Discussion Papers - 2013

of the restructuring left money on the table from the perspective of Greece, created a large risk for European taxpayers …

Persistent link: https://www.econbiz.de/10011084095

Confidence Crises and Public Debt Management

Giavazzi, Francesco; Pagano, Marco - C.E.P.R. Discussion Papers - 1989

Under free capital mobility, confidence crises can lead to devaluations even when fixed exchange rates are viable, if fiscal authorities can obtain temporary money financing of deficits. During a crisis domestic interest rates increase, reflecting the expected devaluation. Rather than selling...

Persistent link: https://www.econbiz.de/10005791449

Public Confidence and Debt Management: A Model and a Case Study of Italy

Alesina, Alberto F; Prati, Alessandro; Tabellini, Guido - C.E.P.R. Discussion Papers - 1989

High-debt countries may face the risk of self-fulfilling debt crises. If the public expects that in the future the government will be unable to roll over the maturing debt, they may refuse to buy debt today and choose to hold foreign assets. This lack of confidence may then be self-fulfilling....

Persistent link: https://www.econbiz.de/10005497997

The Impact of News and the SMP on Realized (Co)Variances in the Eurozone Sovereign Debt Market

Beetsma, Roel; de Jong, Frank; Giuliodori, Massimo; … - C.E.P.R. Discussion Papers - 2014

We use realized variances and covariances based on intraday data from Eurozone sovereign bond market to measure the … dependence structure of eurozone sovereign yields. Our analysis focuses on the impact of news, obtained from the Eurointelligence …

Persistent link: https://www.econbiz.de/10011084398

How Does Liquidity Affect Government Bond Yields?

Favero, Carlo A.; Pagano, Marco; von Thadden, Ernst-Ludwig - C.E.P.R. Discussion Papers - 2008

trend in yield differentials, which is correlated with a measure of aggregate risk. In contrast, liquidity differentials … display sizeable heterogeneity and no common factor. We propose a simple model with endogenous liquidity demand, where a bond …'s liquidity premium depends both on its transaction cost and on investment opportunities. The model predicts that yield …

Persistent link: https://www.econbiz.de/10005124174

Fiscal Divergence and Business Cycle Synchronization: Irresponsibility is Idiosyncratic

Darvas, Zsolt; Rose, Andrew K; Szapáry, György - C.E.P.R. Discussion Papers - 2005

Using a panel of 21 OECD countries and 40 years of annual data, we find that countries with similar government budget positions tend to have business cycles that fluctuate more closely. That is, fiscal convergence (in the form of persistently similar ratios of government surplus/deficit to GDP)...

Persistent link: https://www.econbiz.de/10005792350

Stories of the Twentieth Century for the Twenty-First

Gourinchas, Pierre-Olivier; Obstfeld, Maurice - C.E.P.R. Discussion Papers - 2011

A key precursor of twentieth-century financial crises in emerging and advanced economies alike was the rapid buildup of leverage. Those emerging economies that avoided leverage booms during the 2000s also were most likely to avoid the worst effects of the twenty-first century’s first global...

Persistent link: https://www.econbiz.de/10009201122

Fiscal Rules in India: Are They Effective?

Buiter, Willem H.; Patel, Urjit R. - C.E.P.R. Discussion Papers - 2010

This paper, a chapter in the forthcoming Oxford University Press Handbook of the Indian Economy, edited by Chetan Ghate, considers India’s experience with fiscal (responsibility) rules during the past decade. After reviewing the basic facts concerning public debt and deficits in India, the...

Persistent link: https://www.econbiz.de/10008468524

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