Policy, vulnerability and the new debt sustainability framework
We investigate the empirical foundations of the New Debt Sustainability Framework (NDSF), which was recently endorsed by the IMF and the World Bank in support of low-income countries' (LICs) debt sustainability. Our empirical re-assessment questions the existence of a probabilistic relationship between the quality of countries' policies and institutions and their risk of debt distress. In contrast, we find that indicators of economic vulnerability are more significant predictors of debt distress among LICs. We argue that the NDSF is bound to distort aid allocation away from the country-specific circumstances which truly matter for the achievement of debt sustainability. Copyright © 2008 John Wiley & Sons, Ltd.
Volume (Year): 21 (2009)
Issue (Month): 7 ()
|Contact details of provider:|| Web page: http://www3.interscience.wiley.com/journal/5102/home|
References listed on IDEAS
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.:
- Kevin Ross & R. Brooks & Robert Powell & Ydahlia A. Metzgen Quemarez & Doris C. Ross & Mariano Cortes & Saqib Rizavi & Benoit Ketchekmen & Francesca Fornasari, 1998. "External Debt Histories of Ten Low-Income Developing Countries: Lessons From their Experience," IMF Working Papers 98/72, International Monetary Fund.
- Kanbur, Ravi, 2005.
"Reforming the Formula: A Modest Proposal for Introducing Development Outcomes in IDA Allocation Procedures,"
127071, Cornell University, Department of Applied Economics and Management.
- Kanbur, Ravi, 2005. "Reforming the Formula: A Modest Proposal for Introducing Development Outcomes in IDA Allocation Procedures," CEPR Discussion Papers 4971, C.E.P.R. Discussion Papers.
- Kraay, Aart & Nehru, Vikram, 2004.
"When is external debt sustainable?,"
Policy Research Working Paper Series
3200, The World Bank.
- Patrick GUILLAUMONT & Lisa CHAUVET, 1999.
"Aid and Performance: A Reassessment,"
- Madhur Gautam, 2003. "Debt Relief for the Poorest : An OED Review of the HIPC Initiative," World Bank Publications, The World Bank, number 15164, October.
- Christopher L. Gilbert & Alexandra Tabova, 2005. "Can we link concessional debt service to commodity prices?," Department of Economics Working Papers 0508, Department of Economics, University of Trento, Italia.
When requesting a correction, please mention this item's handle: RePEc:wly:jintdv:v:21:y:2009:i:7:p:895-914. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
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.