@techreport{NBERw0861,
 title = "LDC Debt in the 1980s: Risk and Reforms",
 author = "Jeffrey Sachs",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "861",
 year = "1982",
 month = "February",
 URL = "http://www.nber.org/papers/w0861",
 abstract = {With the rapid increase in LDC indebtedness in the recent decade, the issues of creditworthiness and country risk have gained new importance. This paper offers a theoretical and historical analysis of international capital markets in the presence of default risk. The theoretical model suggests the possibility of a prisoners' dilemma in the loan market, in which a country's dominant noncooperative strategy is to default, though a welfare-improving cooperative strategy is available. The historical analysis suggests that the IMF may play a key role in guiding creditors and debtor nations to reach cooperative solutions.},
}