The Millenium Development Goals and Sovereign Debt Write-downs
AbstractCan sovereign debt write-downs be used to achieve the Millennium Development Goals (MDGs)? This paper shows that transparency of domestic governance determines how a sovereign debt write-down is structured to attain the MDGs. When domestic governance is transparent, an unconditional debt write-down enhances non-elitesâ€™ welfare. Without such transparency, conditions that directly link the debt write-down to public goods that improve non-elitesâ€™ welfare are required. In the latter case, in a dynamic setting, the debt write-down also has to be directly linked to the amount of new debt issued. Using our formal analysis, we evaluate the efficacy of the current debt relief initiatives and discuss some policy implications.
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Bibliographic InfoPaper provided by Centre for Dynamic Macroeconomic Analysis in its series CDMA Working Paper Series with number 200718.
Date of creation: 15 Oct 2007
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Debt Write-down; Representativeness; Transparency; Conditionality; Millennium Development Goals.;
Find related papers by JEL classification:
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- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
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- F34 - International Economics - - International Finance - - - International Lending and Debt Problems
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-11-03 (All new papers)
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.:
- Nancy Birdsall & John Williamson, 2002. "Delivering on Debt Relief: From IMF Gold to a New Aid Architecture," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 337, July.
- Jeffrey D. Sachs, 2002. "Resolving the Debt Crisis of Low-Income Countries," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 33(1), pages 257-286.
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