This paper describes and quantifies fiscal risk in advanced and developing economies. Forecast errors in GDP growth explain nearly half of fiscal risk in advanced economies. However, errors in growth forecasts are less important in explaining fiscal risk in low- and middle-income countries. Most...

During the pandemic, public debt in Latin America and the Caribbean rose to more than 70 percent of GDP, and countries are now attempting to lower debt ratios. We analyze past debt reduction episodes and find inflation and the real interest rate were the most frequent main drivers, while higher...

This paper surveys the recent literature on fiscal sustainability, with particular emphasis on emerging market countries. It discusses the main elements that differentiate emerging market countries from industrial countries and then discusses how probabilistic models can help to evaluate fiscal...

This paper surveys the recent literature on fiscal sustainability, with particular emphasis on emerging market countries. It discusses the main elements that differentiate emerging market countries from industrial countries and then discusses how probabilistic models can help to evaluate fiscal...

The paper shows that international government borrowing from multilateral development banks is countercyclical while international government borrowing form private sector lenders is procyclical. The countercyclicality of official lending is mostly driven by the behavior of the World Bank...

The paper shows that international government borrowing from multilateral development banks is countercyclical while international government borrowing form private sector lenders is procyclical. The countercyclicality of official lending is mostly driven by the behavior of the World Bank...

This paper uses the rules of engineering as a rhetorical device to discuss why the international financial architecture needs a structured mechanism for dealing with sovereign insolvency. The paper suggests that the most important problem with the status-quo relates to delayed defaults and...