TY  - JOUR
AU  - Eichengreen,Barry J.
AU  - Portes,Richard
TI  - Debt and Default in the 1930s:  Causes and Consequences
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 1772
PY  - 1986
Y2  - December 1986
UR  - http://www.nber.org/papers/w1772
L1  - http://www.nber.org/papers/w1772.pdf
N1  - Author contact info:
Barry Eichengreen
Department of Economics
University of California, Berkeley
549 Evans Hall 3880
Berkeley, CA 94720-3880
Tel: 510/642-2772
Fax: 510/643-0926
E-Mail: eichengr@econ.Berkeley.edu

Richard Portes
London Business School
Regent's Park
London NW1 4SA
UNITED KINGDOM
Tel: 44 (0)  20 7000 8424
Fax:  44 (0) 20 7000 8401
E-Mail: rportes@london.edu
M2  - featured in NBER digest on 1986-04-01
AB  - This paper analyzes the "debt crisis" of the 1930s to see what light this historical experience sheds on recent difficulties in international capital markets. We first consider patterns of overseas lending and borrowing in the 1920s and 1930s, comparing the performance of standard models of foreign borrowing in this period to the 1970-80s. Next, we analyze the incidence and extent of defaulton sovereign debt, adapting models of debt capacity to the circumstances of the interwar years. We consider the choices available to investors in those foreign loans which lapsed into default in the 1930s, emphasizing the distinction between creditor banks and bond holders. Finally, we provide the first estimates of the realized rate of return on foreign loans floated between the wars, based on a sample of dollar andsterling bonds issued in the 1920s.
ER  -