State-Contingent Government Debt: a New Database

Goncalo Pina

Credit and Capital Markets – Kredit und Kapital, 2022, vol. 55, issue 1, 35-66

Abstract: State-contingent government debt has been proposed as a way to reduce costly debt crisis. However, markets for this type of debt remain very limited, for reasons that are not yet fully understood. This paper describes a new database covering state-contingent government debt issued between 1863 and 2020. Based on these data, this paper shows stylized facts regarding the main design features, and market performance, of state-contingent government debt. It also provides a brief history of state-contingent government borrowing, which is contextualized with a simple theoretical model of state-contingent debt. The results show that there have been several small, heterogeneous, issuances of state-contingent debt, which resemble pilot runs in this new asset class. The paper concludes with some common challenges associated to state-contingent government debt.

Keywords: State-Contingent Debt; GDP-Linked Bonds; Public Debt (search for similar items in EconPapers)
JEL-codes: G1 H63 N2 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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