This paper assesses the consequences of implementing a joint liability debt system in a two-country small open economy model. With joint liability a default of one country makes the other participant liable for its debt. The results highlight a trade-off between the contagion risk, in the sense...

This paper utilizes data for African countries to analyze the extent to which financial development affects the dynamics of the relationship between exchange rate flexibility and economic growth. The findings indicate that financial development exerts a positive influence on the relationship...