External Debt Sustainability: Theory and Empirical Evidence

Marco Arnone, Luca Bandiera and Andrea Presbitero
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Luca Bandiera: World Bank

International Finance from University Library of Munich, Germany

Abstract: This paper is a review of the different approaches on external debt sustainability. The Heavily Indebted Poor Country (HIPC) Initiative was launched to assure a permanent exit from debt dependence. However, the IMF-World Bank program is not without faults, in particular for what concerns debt sustainability analysis. The aim of this work is to present the IMF-World Bank approach to debt sustainability, together with the other approaches in the literature. We show that a new and broader framework is emerging to address the main shortcomings of the standard analysis, namely, the effects that large external debts and deficits have on growth and the macroeconomic environment.

Keywords: HIPC Initiative; Debt Sustainability; Debt Relief; External Debt. (search for similar items in EconPapers)
JEL-codes: F34 H63 O11 O19 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2005-12-25
New Economics Papers: this item is included in nep-afr, nep-dev and nep-pbe
Note: Type of Document - pdf; pages: 48
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpif:0512007

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