Debt and default in a growth model
Autor(a) principal: | |
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Data de Publicação: | 2006 |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional do FGV (FGV Repositório Digital) |
Texto Completo: | http://hdl.handle.net/10438/13007 |
Resumo: | This paper presents a small open economy model with capital accumulation and without commitment to repay debt. The optimal debt contract specifies debt relief following bad shocks and debt increase following good shocks and brings first order benefits if the country's borrowing constraint is binding. Countries with less capital (with higher marginal productivity of capital) have a higher debt-GDP ratio, are more likely to default on uncontingent bonds, require higher debt relief after bad shocks and pay a higher spread over treasury. Debt relief prescribed by the optimal contract following the interest rate hikes of 1980-81 is more than half of the debt forgiveness obtained by the main Latin American countries through the Brady agreements. |
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Guimarães, Bernardo de VasconcellosEscolas::EPGEFGV2015-01-05T11:45:46Z2015-01-05T11:45:46Z2006-08-11http://hdl.handle.net/10438/13007This paper presents a small open economy model with capital accumulation and without commitment to repay debt. The optimal debt contract specifies debt relief following bad shocks and debt increase following good shocks and brings first order benefits if the country's borrowing constraint is binding. Countries with less capital (with higher marginal productivity of capital) have a higher debt-GDP ratio, are more likely to default on uncontingent bonds, require higher debt relief after bad shocks and pay a higher spread over treasury. Debt relief prescribed by the optimal contract following the interest rate hikes of 1980-81 is more than half of the debt forgiveness obtained by the main Latin American countries through the Brady agreements.engFundação Getulio Vargas. Escola de Pós-graduação em Economia.Seminários de Almoço da EPGETodo cuidado foi dispensado para respeitar os direitos autorais deste trabalho. Entretanto, caso esta obra aqui depositada seja protegida por direitos autorais externos a esta instituição, contamos com a compreensão do autor e solicitamos que o mesmo faça contato através do Fale Conosco para que possamos tomar as providências cabíveisinfo:eu-repo/semantics/openAccessSovereign debtDefaultCapital flowsOptimal contractWorld interest ratesEconomiaDívida externaTaxas de jurosDebt and default in a growth modelinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articlereponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVORIGINAL000385155_g963d.pdf000385155_g963d.pdfapplication/pdf1288223https://repositorio.fgv.br/bitstreams/3218d51f-14d4-49c8-9ef8-4fe30a3638dc/download9fa35cb910f22092fde500426e89f37fMD51LICENSElicense.txtlicense.txttext/plain; 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dc.title.eng.fl_str_mv |
Debt and default in a growth model |
title |
Debt and default in a growth model |
spellingShingle |
Debt and default in a growth model Guimarães, Bernardo de Vasconcellos Sovereign debt Default Capital flows Optimal contract World interest rates Economia Dívida externa Taxas de juros |
title_short |
Debt and default in a growth model |
title_full |
Debt and default in a growth model |
title_fullStr |
Debt and default in a growth model |
title_full_unstemmed |
Debt and default in a growth model |
title_sort |
Debt and default in a growth model |
author |
Guimarães, Bernardo de Vasconcellos |
author_facet |
Guimarães, Bernardo de Vasconcellos |
author_role |
author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EPGE |
dc.contributor.affiliation.none.fl_str_mv |
FGV |
dc.contributor.author.fl_str_mv |
Guimarães, Bernardo de Vasconcellos |
dc.subject.eng.fl_str_mv |
Sovereign debt Default Capital flows Optimal contract World interest rates |
topic |
Sovereign debt Default Capital flows Optimal contract World interest rates Economia Dívida externa Taxas de juros |
dc.subject.area.por.fl_str_mv |
Economia |
dc.subject.bibliodata.por.fl_str_mv |
Dívida externa Taxas de juros |
description |
This paper presents a small open economy model with capital accumulation and without commitment to repay debt. The optimal debt contract specifies debt relief following bad shocks and debt increase following good shocks and brings first order benefits if the country's borrowing constraint is binding. Countries with less capital (with higher marginal productivity of capital) have a higher debt-GDP ratio, are more likely to default on uncontingent bonds, require higher debt relief after bad shocks and pay a higher spread over treasury. Debt relief prescribed by the optimal contract following the interest rate hikes of 1980-81 is more than half of the debt forgiveness obtained by the main Latin American countries through the Brady agreements. |
publishDate |
2006 |
dc.date.issued.fl_str_mv |
2006-08-11 |
dc.date.accessioned.fl_str_mv |
2015-01-05T11:45:46Z |
dc.date.available.fl_str_mv |
2015-01-05T11:45:46Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10438/13007 |
url |
http://hdl.handle.net/10438/13007 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.ispartofseries.por.fl_str_mv |
Seminários de Almoço da EPGE |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.publisher.none.fl_str_mv |
Fundação Getulio Vargas. Escola de Pós-graduação em Economia. |
publisher.none.fl_str_mv |
Fundação Getulio Vargas. Escola de Pós-graduação em Economia. |
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FGV |
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Repositório Institucional do FGV (FGV Repositório Digital) |
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