This paper revises and extends our previous (1986) analysis of rates of return on sterling and dollar foreign loans of the 1920s. It analyzes a larger sample of 250 dollar bonds and 125 sterling issues, covering the years 1920-9. Internal rates of return are adjusted for repurchases of...

This paper summarizes and extends the conclusions of a series of papers on the interwar experience of sovereign borrowing, default and debt readjustment. In explaining the incidence and extent of default, we highlight the importance of a range of factors, both economic and political. We find...

We scrutinize two strands of received wisdom about debt crises: that which draws a strong contrast between the 1930s and 1980s in extent of default and ease of settlement, and that which attributes the difference to greater government involvement today. Rather than a sharp, dichotomous variable,...

A financial crisis is a disturbance to financial markets, associated typically with falling asset prices and insolvency among debtors and intermediaries, which spreads through the financial system, disrupting the market's capacity to allocate capital. In this paper we analyze the generation and...

This paper analyzes the 'debt crisis' of the 1930s to see what light this historical experience sheds on recent difficulties in international capital markets. We first consider patterns of overseas lending and borrowing in the 1920s and 1930s, comparing the performance of standard models of...

The Paper sets out the principles that should underlie sovereign debt restructuring. It argues for a rules-based approach to achieve private sector involvement in restructuring. The rules must operate, however, in the context of an appropriate institutional framework with appropriate incentives....

This paper is the Introduction to a special issue of European Economy on `The Path of Reform in Central and Eastern Europe'. It discusses the sources of the current wave of `Europessimism': exogenous shocks, adjustment costs, sequencing errors, and other policy errors. This analysis may help in...

This paper discusses when and how to introduce foreign exchange convertibility in the process of transformation of the socialist centrally-planned economies into market economies based on private property. It elucidates the need for `robust sequencing' in a programme of economic reforms and the...

This paper discusses the EMS and proposals to move towards EMU in the context of recent theoretical and empirical work on international policy coordination. It treats two particular themes: asymmetry among EMS countries and its implications for policy coordination; and the coordination required...

We examine the evolution of the Icelandic banking sector in its macroeconomic environment. The story culminates in the crisis of October 2008, when all three major banks in Iceland collapsed in three successive days. The country is still struggling to cope with the consequences. The paper...