Structuring and restructuring sovereign debt
Subtitle: the role of seniority
By: Patrick Bolton, Olivier Jeanne.
Contributors: Jeanne, Olivier.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11071; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11071.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Debt relief -- Mathematical models.; Debts, External -- Mathematical models.
Description: "In an environment characterized by weak contractual enforcement, sovereign lenders can enhance the likelihood of repayment by making their claims more difficult to restructure.  We show within a simple model how competition for repayment between lenders may result in sovereign debt that is excessively difficult to restructure in equilibrium.  Alleviating this inefficiency requires a sovereign debt restructuring mechanism that fulfills some of the functions of corporate bankruptcy regimes, in particular the enforcement of seniority and subordination clauses in debt contracts"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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Mode of access: World Wide Web.