The New Zealand Debt Conversion Act 1933: a case study in coercive domestic public debt restructuring
AbstractNew Zealand entered the Great Depression with very large public and private debts. The burden of those debts was greatly exacerbated by the unexpected size of the fall in real incomes and in the price level. In 1931 and 1932, the government passed legislation to ease pressure on private creditors, and in 1933 followed Australia’s lead in using legislation to compel domestic holders of existing government debt to accept a lower interest rate on that debt. The conversion operation appears to have had a number of goals. The fiscal savings were significant, although probably not decisive. It was also hoped that cutting interest rates on outstanding domestic debt might make external creditors more receptive to lowering the cost of New Zealand’s substantial offshore public debt. Perhaps as importantly, the conversion operation was one more piece in an ongoing programme of measures to adjust to, and reverse, some of the redistributive effects of the unexpected steep fall in the price level.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Reserve Bank of New Zealand in its journal Reserve Bank of New Zealand Bulletin.
Volume (Year): 75 (2012)
Issue (Month): (March)
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statistics
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Reserve Bank of New Zealand Knowledge Centre).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.