Debt Sustainability in the Case of External Debt. An Analysis Based on Italy's Treasury Auctions

Arbeitspapier

The objective of this paper is to assess whether external debt makes a difference for public debt stabilization, where external debt is considered through the non-residents' holdings according to a Balance of Payments perspective. The analysis is empirical and considers the case of Italy, one of the world's largest debt issuer. We study the potential effects on the interest rate resulting from the auctions of government bonds to account for the effective cost borne by the Treasury. Our results point towards the irrelevance of the composition of the investor base for debt stabilization.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 5021

Classification and Topics

• Classification: Wirtschaft ; Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy ; International Lending and Debt Problems ; Portfolio Choice; Investment Decisions ; National Debt; Debt Management; Sovereign Debt
• Subject: debt stabilization ; external debt ; primary market ; yields ; Italy

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cafiso, Gianluca
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/103107
• Last update: 10.03.2025, 11:42 AM CET