The paper investigates the relationship between external debt and economic growth, focusing on the role played by the policy and institutional framework. Results for a panel of 114 developing countries show that the debt-growth nexus depends on institutions and policies. The Debt-Laffer curve...

This paper investigates the relationship between external indebtedness and economic growth, with a particular attention to LICs, for which the theoretical arguments of debt overhang and liquidity constraint have to be reconsidered. The estimation of a growth model, with a panel of 121 developing...

The UK's Debt Relief (Developing Countries) Act 2010 aims to ensure that UK courts neither give nor enforce a judgment allowing recovery against Heavily Indebted Poor Countries (‘HIPC') on covered debts exceeding the amount calculated as sustainable under the HIPC Initiative.Some have objected...

The aim of this article is to illustrate how the large repayments of external debts undermine a debtor country's ability to comply with its obligations under the International Covenant on Economic, Social and Cultural Rights and to argue that adequate debt relief to the poorest debtor countries...

Alexander Hamilton proposed a debt conversion plan for the United States in 1790 that allowed different creditors to choose from a list of different (reduced) repayment options. This plan was not, however, adopted by Congress, which instead opted for a one-size fits all scheme. Modern economic...

The effects of debt relief on incentives to accumulate debt, consume, and invest are an important concern for donors and recipients. Using a dynamic stochastic general equilibrium model of a small open economy with a minimum consumption requirement and an endogenous relief probability, we show...

Mozambique has been one of the first highly indebted countries to obtain a debt reduction, in the framework of HIPC and enhanced HIPC initiative, and to implement a Poverty Reduction Strategy Paper. The process is still in its early stages, but it is already possible to investigate on the recent...

International debt contracts can incorporate at least implicitly contingencies governing debt reduction. This paper examines a series of debt contracts that allow for the possibility of rescheduling, forgiveness, and rescheduling with forgiveness. The contract with both rescheduling and...

The paper presents a theoretical model to explain how debt overhang is generated in low-income countries and discusses its implications for debt relief. The paper indicates that the extent of debt overhang, and the effectiveness of debt relief, would depend on a recipient country's initial...