Search Results

Showing results 1 to 1 of approximately 1.

(refine search)
SORT BY: PREVIOUS / NEXT
Keywords:Default 

Working Paper
Domestic Policies and Sovereign Default

This paper incorporates fiscal and monetary policies into a model of sovereign default. In addition to the standard present-bias vs default-risk tradeoff faced by governments when choosing debt, distortionary policy instruments introduce an intertemporal tradeoff, which may mitigate or exacerbate the incentives to accumulate debt. Taxation, the money growth rate and currency depreciation all increase with the level of debt. The model reproduces standard business cycle statistics, the response of spreads, inflation and growth to terms-of-trade shocks, and the cyclical properties of fiscal and ...
Working Papers , Paper 2020-017

FILTER BY Bank

FILTER BY Series

FILTER BY Content Type

FILTER BY Author

FILTER BY Jel Classification

E52 1 items

E62 1 items

F34 1 items

F41 1 items

G15 1 items

FILTER BY Keywords

Country Risk 1 items

Crises 1 items

Default 1 items

Emerging Markets 1 items

Exchange Rate 1 items

Fiscal Policy 1 items

show more (6)

PREVIOUS / NEXT