IMF Seniority as a compromise for affordable debt

Resumo

This paper addresses the role of the International Monetary Fund in the international monetary economy as a senior agent, as observed empirically. A sovereign agent subject to a stochastic shock must borrow to smooth out consumption. The international financial market offers fund, however it charges a premium for sharing the risk over the shock with the government. The IMF, however senior, lends at a lower rate. Hence, the sovereign government must choose its borrower. We find conditions under which the IMF presence in such market is relevant and positive to the borrowing agent. Such conditions will depend on the size of the risk premium charged, which in our analysis will be exogenously given

Ficha do documento

Tipo

Dissertação

Ano

2017

Instituição

Fundação Getulio Vargas

Fonte

Repositório da FGV

Idioma

Inglês

Acesso

Não informado

Identificador

oai:repositorio.fgv.br:10438/18279

Temas

Economia

Palavras-chave

Sovereign debtContingent claimRisk premiumDefault riskIMFDebt, seniorityDívida soberanaDívida contingentePrêmio de riscoFMIRisco de defaultDívidaSenioridadeEconomiaFinanças internacionaisDívida externaFundo Monetário InternacionalMacroeconomia