Debt Limits and the Structure of Public Debt /
Pienkowski, Alex,
Debt Limits and the Structure of Public Debt / by Alex Pienkowski. - Washington, D.C. : INTERNATIONAL MONETARY FUND, 2017. - 1 online resource (22) - IMF working paper ; WP/17/117 . - IMF working paper ; WP/17/117. IMF Working Papers. .
Includes bibliographical references and index.
Cover; Contents; I. Background; II. Model; III. Calibration; IV. Results; V. Conclusion; References; Annex.
This paper provides a tractable framework to assess how the structure of debt instruments-specifically by currency denomination and indexation to GDP-can raise the debt limit of a sovereign. By calibrating the model to different country fundamentals, it is clear that there is no one-size-fits-all approach to optimal instrument design. For instance, low income countries may find benefit in issuing local currency debt; while in advanced economies debt tolerance can be substantially enhanced through issuing GDP-linked bonds. By looking at the marginal impact of these instruments, the paper also provides insight into the optimal portfolio compostion.
1484301080 9781484301081
10.5089/9781484300657.001 doi
1013866 MIL
Debts, Public--Management.
BUSINESS & ECONOMICS / Public Finance.
Electronic books.
HJ8011
336.34
Debt Limits and the Structure of Public Debt / by Alex Pienkowski. - Washington, D.C. : INTERNATIONAL MONETARY FUND, 2017. - 1 online resource (22) - IMF working paper ; WP/17/117 . - IMF working paper ; WP/17/117. IMF Working Papers. .
Includes bibliographical references and index.
Cover; Contents; I. Background; II. Model; III. Calibration; IV. Results; V. Conclusion; References; Annex.
This paper provides a tractable framework to assess how the structure of debt instruments-specifically by currency denomination and indexation to GDP-can raise the debt limit of a sovereign. By calibrating the model to different country fundamentals, it is clear that there is no one-size-fits-all approach to optimal instrument design. For instance, low income countries may find benefit in issuing local currency debt; while in advanced economies debt tolerance can be substantially enhanced through issuing GDP-linked bonds. By looking at the marginal impact of these instruments, the paper also provides insight into the optimal portfolio compostion.
1484301080 9781484301081
10.5089/9781484300657.001 doi
1013866 MIL
Debts, Public--Management.
BUSINESS & ECONOMICS / Public Finance.
Electronic books.
HJ8011
336.34