Debt Limits and the Structure of Public Debt /

This paper provides a tractable framework to assess how the structure of debt instruments-specifically by currency denomination and indexation to GDP-can raise the debt limit of a sovereign. By calibrating the model to different country fundamentals, it is clear that there is no one-size-fits-all ap...

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Bibliografiska uppgifter
Huvudupphovsman: Pienkowski, Alex
Materialtyp: Tidskrift
Språk:English
Publicerad: Washington, D.C. : International Monetary Fund, 2017.
Serie:IMF Working Papers; Working Paper ; No. 2017/117
Länkar:Full text available on IMF
Beskrivning
Sammanfattning:This paper provides a tractable framework to assess how the structure of debt instruments-specifically by currency denomination and indexation to GDP-can raise the debt limit of a sovereign. By calibrating the model to different country fundamentals, it is clear that there is no one-size-fits-all approach to optimal instrument design. For instance, low income countries may find benefit in issuing local currency debt; while in advanced economies debt tolerance can be substantially enhanced through issuing GDP-linked bonds. By looking at the marginal impact of these instruments, the paper also provides insight into the optimal portfolio compostion.
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Fysisk beskrivning:1 online resource (21 pages)
Materialtyp:Mode of access: Internet
ISSN:1018-5941
Tillgång:Electronic access restricted to authorized BRAC University faculty, staff and students