TY  - JOUR
AU  - Sinn,Hans-Werner
TI  - American Economic Policy and the International Debt Crisis
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3532
PY  - 1990
Y2  - December 1990
UR  - http://www.nber.org/papers/w3532
L1  - http://www.nber.org/papers/w3532.pdf
N1  - Author contact info:
Hans-Werner Sinn
Ifo Institute -
Leibniz Institute for Economic Research
at University of Munich
Poschingerstr. 5
81679 Munich
GERMANY
Tel: 49-89-21802748
Fax: 49-89-397303;49-89-8506434 (home)
E-Mail: sinn@ifo.de
AB  - This paper advances the hypothesis that the world debt crisis was mainly induced by the dramatic rise of US interest rates in the first half of the eighties. It sees this rise in interest rates primarily as a result of a tight US monetary policy and excessively large investment incentives provided by the 1981 Us tax reform. A welfare analysis shows that the policies could have increased the US advantage from lending its capital abroad, had they been more moderately designed. The actual policies, however, were by far too strong to produce this result.
ER  -