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Sovereign Debt Crises

Authors 
Publication Year 
2014
Abstract 
Sovereign debt crises can be triggered by highdefault probabilities induced by high interestrates. This is more likely if debt is relatively large.In this context, the intervention of a large lenderwith deep pockets, such as the European CentralBank (ECB), can help coordinate on low interestrates. The article is based on the work ofNavarro, Nicolini and Teles (2014).
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Journal (repec) 
Economic Bulletin
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