Debt Sustainability for Low-Income Countries: A Review of Standard and Alternative Concepts
Governments in low-income countries have the difficult task of making wide-ranging decisions about public spending, taxation, and borrowing. Although we can analyze at length how both public spending and taxation can be designed and implemented to contribute to growth and poverty reduction, the biggest challenge that most developing countries face is in determining how much they can borrow without jeopardizing their long-term prospects. The objective of this paper is to introduce the key issues involved in debt sustainability analysis. We review the main approaches developed in the literature, starting from the traditional fiscal and external approaches and covering recent alternative frameworks, such as the debt overhang analysis and the human development approach (especially as it relates to the funding requirements for achieving the Millennium Development Goals).
|Date of creation:||Jan 2008|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
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.:
- 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.
- berlage, Lodewijk & cassimon, Danny & dreze, Jacques & Reding, Paul, 2003.
"Prospective Aid and Indebtedness Relief: A Proposal,"
Elsevier, vol. 31(10), pages 1635-1654, October.
- BERLAGE, Lode & CASSIMON, Danny & DREZE, Jacques & REDING, Paul, 2000. "Prospective aid and indebtedness relief: a proposal," CORE Discussion Papers 2000032, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- BERLAGE, Lode & CASSIMON, Danny & DRÈZE, Jacques & REDING, Paul, 2000. "Prospective aid and indebtedness relief: A proposal," Working Papers 2000012, University of Antwerp, Faculty of Applied Economics.
- BERLAGE, Lodewijk & CASSIMON, Danny & DRÃˆZE, Jacques & REDING, Paul, . "Prospective aid and indebtedness relief: a proposal," CORE Discussion Papers RP 1660, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Nicolas Depetris Chauvin & Aart Kraay, 2007.
"Who Gets Debt Relief?,"
Journal of the European Economic Association,
MIT Press, vol. 5(2-3), pages 333-342, 04-05.
- Cohen, Daniel, 1996. "The sustainability of African debt," Policy Research Working Paper Series 1621, The World Bank.
- 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.
- John T. Cuddington, 1997.
"Analysing the Sustainability of Fiscal Deficits in Developing Countries,"
- Cuddington, John T., 1997. "Analyzing the sustainability of fiscal deficitsin developing countries," Policy Research Working Paper Series 1784, The World Bank.
- Krugman, Paul, 1988.
"Financing vs. forgiving a debt overhang,"
Journal of Development Economics,
Elsevier, vol. 29(3), pages 253-268, November.
- Yan Sun, 2004. "External Debt Sustainability in HIPC Completion Point Countries," IMF Working Papers 04/160, International Monetary Fund.
- Catherine Pattillo & Hélène Poirson & Luca Antonio Ricci, 2011.
"External Debt and Growth,"
Review of Economics and Institutions,
Università di Perugia, vol. 2(3).
- Claessens, Stijn, 1990. "The debt laffer curve: Some estimates," World Development, Elsevier, vol. 18(12), pages 1671-1677, December.
- HÃ©lÃ¨ne Poirson & Luca Antonio Ricci & Catherine A. Pattillo, 2004. "What Are the Channels Through Which External Debt Affects Growth?," IMF Working Papers 04/15, International Monetary Fund.
- Kraay, Aart & Nehru, Vikram, 2004.
"When is external debt sustainable?,"
Policy Research Working Paper Series
3200, The World Bank.
- Raffer, Kunibert, 1990. "Applying chapter 9 insolvency to international debts: An economically efficient solution with a human face," World Development, Elsevier, vol. 18(2), pages 301-311, February.
- Nicolas Depetris Chauvin & Aart Kraay, 2005. "What Has 100 Billion Dollars Worth of Debt Relief Done for Low- Income Countries?," International Finance 0510001, EconWPA.
- Easterly, William, 1999.
"When is fiscal adjustment an illusion?,"
Policy Research Working Paper Series
2109, The World Bank.
- Peter Hjertholm, 2003. "Theoretical and empirical foundations of HIPC debt sustainability targets," Journal of Development Studies, Taylor & Francis Journals, vol. 39(6), pages 67-100.
- Ley, Eduardo, 2009. "Fiscal (and external) sustainability," MPRA Paper 13693, University Library of Munich, Germany.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:11077. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.