International coordination of debt rules with time‐inconsistent voters

Ryo Arawatari and Tetsuo Ono

Journal of Public Economic Theory, 2023, vol. 25, issue 1, 29-60

Abstract: In this study, we investigate the international coordination of debt rules in an economy consisting of several countries with varying degrees of present bias. A case wherein each country sets its own uncoordinated debt rules is compared with a case wherein all countries have common coordinated debt rules. Countries with weak present‐biased preferences increase their debt issuance and suffer from welfare losses by participating in coordination. In contrast, countries with strong present‐biased preferences reduce their debt issuance and can enjoy welfare improvement by participating in coordination. The contrasting results suggest the possibility that countries with weak present‐biased preferences have little incentive to follow the coordinated rule.

Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://doi.org/10.1111/jpet.12577

Related works:
Working Paper: International Coordination of Debt Rules with Time-inconsistent Voters (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jpbect:v:25:y:2023:i:1:p:29-60

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1097-3923

Access Statistics for this article

Journal of Public Economic Theory is currently edited by Rabah Amir, Gareth Myles and Myrna Wooders

More articles in Journal of Public Economic Theory from Association for Public Economic Theory Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().