We show that increased uncertainty about the size of an emerging market's external debt has a nonlinear and potentially large adverse effect on the supply of international credit offered to them. We also show that if international creditors are first- order risk averse, attaching greater weight...

Ausführliche Beschreibung

Bibliographische Detailangaben

Hauptverfasser:	Aizenman, Joshua 1949- (VerfasserIn), Marion, Nancy Peregrim 1949- (VerfasserIn)
Format:	Buch
Sprache:	English
Veröffentlicht:	Cambridge, Mass. 1999
Schriftenreihe:	National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 7389
Schlagworte:	Entwicklungsländer Ökonometrisches Modell Capital market > Developing countries > Econometric models Credit > Developing countries > Econometric models Debts, External > Developing countries > Econometric models
Online-Zugang:	Volltext
Zusammenfassung:	We show that increased uncertainty about the size of an emerging market's external debt has a nonlinear and potentially large adverse effect on the supply of international credit offered to them. We also show that if international creditors are first- order risk averse, attaching greater weight to utility derived from bad outcomes than from good ones, a moderate increase in uncertainty about debt overhang or about other relevant factors affecting repayment prospects-- can cause the supply of credit to dry up completely. We therefore offer one possible explanation for why emerging markets may find themselves suddenly cut off from international capital markets.
Beschreibung:	32 S. graph. Darst.