@techreport{NBERw7389,
 title = "Uncertainty and the Disappearance of International Credit",
 author = "Joshua Aizenman and Nancy P. Marion",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "7389",
 year = "1999",
 month = "October",
 URL = "http://www.nber.org/papers/w7389",
 abstract = {We show that increased uncertainty about the size of an emerging market's external debt has a nonlinear and potentially large adverse effect on the supply of international credit offered to them. We also show that if international creditors are first- order risk averse, attaching greater weight to utility derived from bad outcomes than from good ones, a moderate increase in uncertainty about debt overhang or about other relevant factors affecting repayment  prospects-- can cause the supply of credit to dry up completely.   We therefore offer one possible explanation for why emerging markets may find themselves suddenly cut off from international capital markets.},
}