NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Debt Relief and Fiscal Sustainability

Sebastian Edwards

NBER Working Paper No. 8939
Issued in May 2002
NBER Program(s):   IFM

In this paper I analyze the relationship between fiscal policy, aggregate public sector debt sustainability, and debt relief. I develop a methodology to compute the fiscal policy path that is compatible with aggregate debt sustainability in the post-HIPC era. The model explicitly considers the role of domestic debt, and quantifies the extent to which future debt sustainability depends on the availability of concessional loans at subsidized interest rates. The working of the model is illustrated for the case of Nicaragua, a country that in 2002 had one of the highest net present value of public external debt to GDP ratios.

download in pdf format
   (281 K)

email paper

This paper is available as PDF (281 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w8939

Published: Sebastian Edwards, 2003. "Debt relief and fiscal sustainability," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 139(1), pages 38-65, March. citation courtesy of

Users who downloaded this paper also downloaded these:
Ghosh, Kim, Mendoza, Ostry, and Qureshi w16782 Fiscal Fatigue, Fiscal Space and Debt Sustainability in Advanced Economies
Calvo, Izquierdo, and Talvi w9828 Sudden Stops, the Real Exchange Rate, and Fiscal Sustainability: Argentina's Lessons
Doi, Hoshi, and Okimoto w17305 Japanese Government Debt and Sustainability of Fiscal Policy
Broda and Weinstein w10988 Happy News from the Dismal Science: Reassessing the Japanese Fiscal Policy and Sustainability
Doi, Ihori, and Mitsui w12357 Sustainability, Debt Management, and Public Debt Policy in Japan
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us