Arbeitspapier
On the role of financial aid in a default episode
We develop a dynamic stochastic quantitative model of sovereign default featuring fiscal policy, endogenous financial aid and risk-averse foreign lenders, in order to explore the role of financial aid in a default episode. After calibrating the model, we feed output shocks into the model to show that it captures some of the most salient features of the fiscal and debt situation in Argentina during the 1998-2002 period. This underscores the economic nature of the decision to default and the role that official aid could have taken in avoiding such an event. In effect, given the economic challenges endured by Argentina, a full-fledged default took place. In addition, we discuss a number of policy implications associated with financial aid programs aimed at preventing sovereign default episodes.
- Sprache
-
Englisch
- Erschienen in
-
Series: Working Papers ; No. 2018-15
- Klassifikation
-
Wirtschaft
Fiscal Policy
International Lending and Debt Problems
- Thema
-
Sovereign default
fiscal policy
financial aid
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Cuadra, Gabriel
Ramos-Francia, Manuel
García-Verdú, Santiago
- Ereignis
-
Veröffentlichung
- (wer)
-
Banco de México
- (wo)
-
Ciudad de México
- (wann)
-
2018
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:41 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Cuadra, Gabriel
- Ramos-Francia, Manuel
- García-Verdú, Santiago
- Banco de México
Entstanden
- 2018
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