Franklin

Sovereign Bailouts and Senior Loans [electronic resource] Christophe Chamley

Author/Creator:
Chamley, Christophe
Other Title:
World Bank working papers.
Publication:
Washington, D.C., The World Bank, 2012
Series:
Policy research working papers.
World Bank e-Library.
Format/Description:
Government document
Book
1 online resource
System Details:
Mode of access: World Wide Web.
Summary:
Institutional lending in crisis is evaluated from a theoretical point of view. First, the share of senior loans in new loans is irrelevant under a given probability distribution of the country's resources. Second, seniority may partially alleviate the inefficiency of debt contracts when the distribution of resources is endogenous to the country's physical investment and effort towards success. Third, with multiple lending rate equilibria, institutional lending may induce a switch to a lower private loan rate if it can be done in a sufficiently large amount. Fourth, conditions are analyzed under which debt forgiveness is efficient under a financial shock.
Notes:
Description based on print version record.
Contributor:
Chamley, Christophe
Pinto, Brian
World Bank.
Other format:
Print version: Chamley, Christophe Sovereign Bailouts and Senior Loans.
Publisher Number:
10.1596/1813-9450-6181
Access Restriction:
Restricted for use by site license.
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