Sovereign Debt

Jonathan Eaton and Raquel Fernandez

No 5131, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We review the literature on sovereign debt. We organize our survey around three central questions: (1) Why do sovereign debtors ever repay their debts? (2) What burdens, in the form of distortions and inefficiencies, does sovereign debt impose? and (3) How might debt be restructured to reduce these burdens? In grappling with the first question the literature has pointed to, and argued about, the roles of reputation, punishments, rewards and renegotiation. In addressing the second the literature has asked whether sovereign debtors tend to borrow too much or too little, and how debt can distort the domestic economy. Answers to the third question include measures by creditors, by debtors, and by public institutions to reduce debt burdens.

JEL-codes: F34 (search for similar items in EconPapers)
Date: 1995-05
Note: ITI IFM
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (138)

Published as Handbook of International Economics, vol. 3, G. Grossman and K. Rogoff,eds., (Amsterdam: North-Holland, 1995), pp. 2032-2077
Published as Eaton, Jonathan, 1996. "Sovereign Debt, Reputation and Credit Terms," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 1(1), pages 25-35, January.

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Related works:
Chapter: Sovereign debt (1995)
Working Paper: Sovereign Debt (1995)
Working Paper: Sovereign Debt (1995)
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