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Internal Debt Crises and Sovereign Defaults
Arellano, Cristina - 2008
In this paper, we use data from developing countries to argue that sovereign defaults are often caused by fiscal pressures generated by large-scale domestic defaults. We argue that these systemic domestic defaults are caused by shocks best interpreted as being non-fundamental. We construct a...
Persistent link: https://www.econbiz.de/10012464852
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Quantitative Sovereign Default Models and the European Debt Crisis
Bocola, Luigi - 2018
A large literature has developed quantitative versions of the Eaton and Gersovitz (1981) model to analyze default episodes on external debt. In this paper, we study whether the same framework can be applied to the analysis of debt crises in which domestic public debt plays a prominent role. We...
Persistent link: https://www.econbiz.de/10012480634
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History Remembered : Optimal Sovereign Default on Domestic and External Debt
D'Erasmo, Pablo - 2018
. Calibrated to Eurozone data, the model is consistent with key long-run and debt-crisis statistics. Defaults are rare (1.2 percent …
Persistent link: https://www.econbiz.de/10012480724
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Monetary Independence and Rollover Crises
Bianchi, Javier - 2018
This paper shows that the inability to use monetary policy for macroeconomic stabilization leaves a government more vulnerable to a rollover crisis. We study a sovereign default model with self-fulfilling rollover crises, foreign currency debt, and nominal rigidities. When the government lacks...
Persistent link: https://www.econbiz.de/10012480991
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Is It Too Late to Bail Out the Troubled Countries in the Eurozone?
Conesa, Juan Carlos - 2014
Central Bank, and International Monetary Fund) organize similar bailouts for the troubled countries in the Eurozone? Our … analysis suggests that debt levels are so high that bailouts with penalty interest rates could induce the Eurozone governments … to default rather than reduce their debt. A resumption of economic growth is one of the few ways that the Eurozone crises …
Persistent link: https://www.econbiz.de/10012458755
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Distributional Incentives in an Equilibrium Model of Domestic Sovereign Default
D'Erasmo, Pablo - 2013
Europe's debt crisis resembles historical episodes of outright default on domestic public debt about which little research exists. This paper proposes a theory of domestic sovereign default based on distributional incentives affecting the welfare of risk-averse debt- and non-debt holders. A...
Persistent link: https://www.econbiz.de/10012459185
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The Mystique Surrounding the Central Bank's Balance Sheet, Applied to the European Crisis
Reis, Ricardo - 2013
In spite of the mystique behind a central bank's balance sheet, its resource constraint bounds the dividends it can distribute by the present value of seignorage, which is a modest share of GDP. Moreover, the statutes of the Federal Reserve or the ECB make it difficult for it to redistribute...
Persistent link: https://www.econbiz.de/10012459932
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The Short-Run Effects of GDPR on Technology Venture Investment
Jia, Jian - 2018
The General Data Protection Regulation (GDPR) came into effect in the European Union in May 2018. We study its short-run impact on investment in new and emerging technology firms. Our findings indicate negative post-GDPR effects on EU ventures, relative to their US counterparts. The negative...
Persistent link: https://www.econbiz.de/10012480899
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Data Privacy and Temptation
Liu, Zhuang - 2020
This paper derives a preference for data privacy from consumers' temptation utility. This approach facilitates a welfare analysis of different data privacy regulations, such as the GDPR enacted by the European Union and the CCPA enacted by the state of California, when a fraction of the...
Persistent link: https://www.econbiz.de/10012481201
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COVID-19 and SME Failures
Gourinchas, Pierre-Olivier - 2020
We estimate the impact of the COVID-19 crisis on business failures among small and medium size enterprises (SMEs) in seventeen countries using a large representative firm-level database. We use a simple model of firm cost-minimization and measure each firm's liquidity shortfall during and after...
Persistent link: https://www.econbiz.de/10012481180