LDC Debt in the 1980s: Risk and Reforms
AbstractWith the rapid increase in LDC indebtedness in the recent decade, the issues of creditworthiness and country risk have gained new importance. This paper offers a theoretical and historical analysis of international capital markets in the presence of default risk. The theoretical model suggests the possibility of a prisoners' dilemma in the loan market, in which a country's dominant noncooperative strategy is to default, though a welfare-improving cooperative strategy is available. The historical analysis suggests that the IMF may play a key role in guiding creditors and debtor nations to reach cooperative solutions.
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 InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 0861.
Date of creation: Feb 1982
Date of revision:
Note: ITI IFM
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ulrich Baumgartner & G. G. Johnson & K. Burke Dillon & R. C. Williams & Peter Keller & Maria Tyler & Bahram Nowzad & G. Russell Kincaid & TomÃ¡s Reichmann, 1981. "External Indebtedness of Developing Countries," IMF Occasional Papers 3, International Monetary Fund.
- Eaton, Jonathan & Gersovitz, Mark, 1981. "Debt with Potential Repudiation: Theoretical and Empirical Analysis," Review of Economic Studies, Wiley Blackwell, vol. 48(2), pages 289-309, April.
- R. Dornbusch, 1984.
"External Debt, Budget Deficits and Disequilibrium Exchange Rates,"
347, Massachusetts Institute of Technology (MIT), Department of Economics.
- Rudiger Dornbusch, 1986. "External Debt, Budget Deficits and Disequilibrium Exchange Rates," NBER Working Papers 1336, National Bureau of Economic Research, Inc.
If references are entirely missing, you can add them using this form.