Author : International Monetary Fund
Publisher : International Monetary Fund
ISBN 13 : 1451978324
Total Pages : 16 pages
Book Rating : 4.4/5 (519 download)
Book Synopsis Policy Inconsistency and External Debt Service by : International Monetary Fund
Download or read book Policy Inconsistency and External Debt Service written by International Monetary Fund and published by International Monetary Fund. This book was released on 1990-04-01 with total page 16 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper it is argued that the willingness of debtors to make external debt-service payments reflects, in part, their inability to credibly and permanently suspend debt service. The benefits of a credible debt-service suspension would include increased private investment. But this would, in turn, tend to create conditions in which it would then be optimal for the government to resume payments. Thus, debt remains a threat even after the announcement of suspension of debt service. It follows that the expected benefits of such a suspension are limited and may be offset by penalties imposed by creditors.