International financial rescues and debtor-country moral hazard

Ashley Taylor and Prasanna Gai

No 561, Econometric Society 2004 Far Eastern Meetings from Econometric Society

Abstract: This paper examines whether recent international policy initiatives to facilitate financial rescues in emerging market countries have influenced debtors' incentives to access official sector resources. The paper highlights a country's systemic importance as a key characteristic that drives access to official sector finance. It estimates the effect of these financial rescue initiatives on IMF programme participation using a pooled probit model. The safety net permitting exceptional access is shown to have a greater marginal impact on official sector resource usage, the more systemically important the debtor country. The results can be interpreted as offering some support for the presence of debtor-country moral hazard

Keywords: Moral Hazard; International Lending; Financial Crises (search for similar items in EconPapers)
JEL-codes: F33 F34 (search for similar items in EconPapers)
Date: 2004-08-11
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Citations: View citations in EconPapers (7)

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Related works:
Journal Article: International Financial Rescues and Debtor‐Country Moral Hazard (2004)
Working Paper: International financial rescues and debtor-country moral hazard (2004)
Working Paper: International financial rescues and debtor country moral hazard (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ecm:feam04:561

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