This paper challenges a popular explanation for ‘original sin’ – the default prone borrowing of long term debt in foreign exchange by emerging markets – that emphasizes the lack of credibility and commitment of governments, that prevents them from borrowing in their own currency. Basing...

This Paper challenges a popular explanation for ‘original sin’ - the default prone borrowing of long term debt in foreign exchange by emerging markets - that emphasizes the lack of credibility and commitment of governments that prevents them from borrowing in their own currency. Basing our...

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