Foreign Debt and Fear of Floating:A Theoretical Exploration

This paper explores the relationship between the denomination ofpublic debt and the choice of exchange rate regime. Unlike indexeddomestic debt, foreign debt is subject to valuation e¤ects from realexchange rate shocks. In a standard set-up, where a peg functions onlyas a nominal anchor, more foreign debt makes pegging less attractive,because it increases the value of a exible exchange rate as a shockabsorber...

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Year of publication:	2008-03-06
Authors:	Bleaney, Michael F. ; Özkan, Gülçin
Institutions:	University <Nottingham> / Department of Economics ; New York University / Department of Economics
Subject:	Wechselkurs \| Inflation \| Öffentliche Schulden \| Government Debt \| Input-Output-Modell \| Input-Output-Model

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Extent:	159744 bytes 19 p. application/pdf
Series:	The University of Nottingham / School of Economics - discussion papers Discussion PaperNo. 08/03
Type of publication:	Book / Working Paper
Language:	English
Classification:	F33 - International Monetary Arrangements and Institutions ; H63 - Debt; Debt Management ; Financial theory ; Study of commerce ; Individual Working Papers, Preprints ; No country specification
Source:	USB Cologne (business full texts)

Persistent link: https://www.econbiz.de/10005868594