Argentina's "default" of its rescheduled debt has brought out the multiple vested interests or stakeholders involved. This includes not only Argentina and the vulture funds which are insisting on prioritized full payments, but also the majority bondholders who agreed to rescheduling and the...

High sovereign debt in advanced economies has recently revived the debate about the role of coordination problems and self-fulfilling beliefs as drivers of sovereign default risk. I show how default risk can be decomposed in a solvency-risk component and a coordination-risk component. I then...

We ask two questions related to how access to credit affects the nature of business cycles. First, does the standard theory of unsecured credit account for the high volatility and procyclicality of credit and the high volatility and countercyclicality of bankruptcy filings found in U.S. data?...

During 1982–83 and 2003–04, two waves of decentralization in France devolved more powers to the three levels of subnational governments (SNGs): the municipalities, the departments, and the regions. This new institutional framework has enabled SNGs to enjoy a greater degree of autonomous...

“Crowdfunding” is a way of using the Internet to raise money by asking the public to contribute to a project. This Article argues that crowdfunding has succeeded, at least in part, because it makes charitable giving more efficient by solving certain “charity failures,” or inefficiencies...

Much of the literature on the economics of mortgage markets has studied the FRM-ARM choice made by individual borrowers. However, to decide if the outcome of such a choice is efficient or approximately so, it is necessary to explore the question of optimal risk-sharing in mortgage contracts. But...

Where a buyer has paid for goods in advance of delivery, the buyer runs the risk of losing both the goods and the money paid if the seller becomes insolvent. There are legal avenues that the prepaying buyer can pursue, but they have their limitations, are inaccessible to most buyers, and...

When estimating Loss Given Default (LGD) parameters using a workout approach, i.e. discounting cash flows over the workout period, the problem arises of how to take into account partial recoveries from incomplete work-outs. The simplest approach would see LGD based on complete recovery profiles...