The Terms of Trade, Repudiation and Default on Sovereign Debt

Michael Bleaney

Discussion Papers from University of Nottingham, School of Economics

Abstract: A poor country with volatile export prices borrows in international markets. When debt is denominated in foreign currency, there is a temptation to repudiate when export prices are low. Excusable partial defaults reduce this temptation, and thus help to support lending.

Keywords: debt; default; terms of trade (search for similar items in EconPapers)
Date: 2008-05
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Journal Article: The terms of trade, repudiation and default on sovereign debt (2008)
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