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Public Safe Assets Determination

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  • Ly Dai Hung

    (Vietnam Institute of Economics, Hanoi, Vietnam)

Abstract

We characterize the safety of public debt by one cross-section sample of 160 economies. For demand analysis, the public debt is safer for larger financial market size, higher financial development level, lower inflation rate and greater political stability. For supply analysis, by a huger debt stock, the safety improves in economies with high income per capita but deteriorates in economies with low income per capita. The results are robust for Instrument-Variable regressions.

Suggested Citation

  • Ly Dai Hung, 2018. "Public Safe Assets Determination," Working Papers hal-01935126, HAL.
    • Handle: RePEc:hal:wpaper:hal-01935126
    Note: View the original document on HAL open archive server: https://hal.science/hal-01935126
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    References listed on IDEAS

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    1. Charles Yuji Horioka & Takaaki Nomoto & Akiko Terada-Hagiwara, 2013. "Why has Japan’s Massive Government Debt Not Wreaked Havoc (Yet)?," UP School of Economics Discussion Papers 201310, University of the Philippines School of Economics.
    2. Bernanke, B.S., 2011. "International capital flows and the returns to safe assets in the United States 2003-2007," Financial Stability Review, Banque de France, issue 15, pages 13-26, February.
    3. G. M. Grossman & K. Rogoff (ed.), 1995. "Handbook of International Economics," Handbook of International Economics, Elsevier, edition 1, volume 3, number 3.
    4. Michael G. Arghyrou & John D. Tsoukalas, 2011. "The Greek Debt Crisis: Likely Causes, Mechanics and Outcomes," The World Economy, Wiley Blackwell, vol. 34(2), pages 173-191, February.
    5. Gary Gorton, 2017. "The History and Economics of Safe Assets," Annual Review of Economics, Annual Reviews, vol. 9(1), pages 547-586, September.
    6. Mr. Manmohan S. Kumar & Mr. Emanuele Baldacci, 2010. "Fiscal Deficits, Public Debt, and Sovereign Bond Yields," IMF Working Papers 2010/184, International Monetary Fund.
    7. Zhiguo He & Arvind Krishnamurthy & Konstantin Milbradt, 2016. "What Makes US Government Bonds Safe Assets?," American Economic Review, American Economic Association, vol. 106(5), pages 519-523, May.
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    Cited by:

    1. Ly Dai Hung, 2021. "External Debts and Economic Growth when Debt Rating Matters," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 12(03), pages 1-26, October.
    2. Ly Dai Hung, 2020. "A Macro-Finance Model of Government Bonds Yields in Vietnam," Working Papers hal-03133807, HAL.
    3. Ly Dai Hung, 2020. "International Public Capital Flows," Working Papers hal-03090656, HAL.

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    More about this item

    Keywords

    Safe Assets; Credit Ratings; Financial Development;
    All these keywords.

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