IDEAS home Printed from https://ideas.repec.org/p/aoz/wpaper/265.html
   My bibliography  Save this paper

Sovereign Debt Management

Author

Listed:
  • Eduardo Levy Yeyati

Abstract

This paper reviews debt management strategies in Latin America from a positive and a normative perspective. It discusses the definition of the debt perimeter (what items should be considered to optimize the cost-risk balance of a debt strategy), broadening the scope beyond documented general government liabilities to include both contingent and non-financial items, provides an empirical account of the evolution of the composition of sovereign debt in Latin American in the past 20 years, and draws key policy implications.

Suggested Citation

  • Eduardo Levy Yeyati, 2023. "Sovereign Debt Management," Working Papers 265, Red Nacional de Investigadores en Economía (RedNIE).
    • Handle: RePEc:aoz:wpaper:265
    as

    Download full text from publisher

    File URL: https://rednie.eco.unc.edu.ar/files/DT/265.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Eduardo Levy-Yeyati & Juan Francisco Gómez, 2020. "The Cost of Holding Foreign Exchange Reserves," Springer Books, in: Jacob Bjorheim (ed.), Asset Management at Central Banks and Monetary Authorities, edition 1, chapter 0, pages 91-110, Springer.
    2. Charles Engel & JungJae Park, 2022. "Debauchery and Original Sin: The Currency Composition of Sovereign Debt," Journal of the European Economic Association, European Economic Association, vol. 20(3), pages 1095-1144.
    3. Willem H. Buiter & Anne C. Sibert, 1999. "UDROP: A Contribution to the New International Financial Architecture," International Finance, Wiley Blackwell, vol. 2(2), pages 227-247, July.
    4. Ms. Elva Bova & Mr. Robert Dippelsman & Ms. Kara C Rideout & Ms. Andrea Schaechter, 2013. "Another Look at Governments’ Balance Sheets: The Role of Nonfinancial Assets," IMF Working Papers 2013/095, International Monetary Fund.
    5. Bohn, Henning, 1990. "Tax Smoothing with Financial Instruments," American Economic Review, American Economic Association, vol. 80(5), pages 1217-1230, December.
    6. Pablo Ottonello & Diego J. Perez, 2019. "The Currency Composition of Sovereign Debt," American Economic Journal: Macroeconomics, American Economic Association, vol. 11(3), pages 174-208, July.
    7. Jeromin Zettelmeyer & Christoph Trebesch & Mitu Gulati, 2013. "The Greek debt restructuring: an autopsy [Greek bond buyback boondoggle]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 28(75), pages 513-563.
    8. Eduardo Levy Yeyati & Federico Sturzenegger, 2021. "A Balance-Sheet Approach to Fiscal Sustainability," Department of Economics Working Papers wp_gob_2021_05.rdf, Universidad Torcuato Di Tella.
    9. Barro, Robert J. & Gordon, David B., 1983. "Rules, discretion and reputation in a model of monetary policy," Journal of Monetary Economics, Elsevier, vol. 12(1), pages 101-121.
    10. Sosa-Padilla, César & Sturzenegger, Federico, 2023. "Does it matter how central banks accumulate reserves? Evidence from sovereign spreads," Journal of International Economics, Elsevier, vol. 140(C).
    11. Levy-Yeyati, Eduardo & Sturzenegger, Federico, 2007. "A Balance-Sheet Approach to Fiscal Sustainability," Working Paper Series rwp07-044, Harvard University, John F. Kennedy School of Government.
    12. Levy Yeyati, Eduardo, 2008. "The cost of reserves," Economics Letters, Elsevier, vol. 100(1), pages 39-42, July.
    13. W.H. Buiter & A Sibert, 1999. "UDROP: A Small Contribution to the International Financial Architecture," CEP Discussion Papers dp0425, Centre for Economic Performance, LSE.
    14. repec:oup:ecpoli:v:28:y:2013:i:75:p:513-563 is not listed on IDEAS
    15. Ronald W. Anderson & Christopher L. Gilbert & Andrew Powell, 1989. "Securitization and Commodity Contingency in International Lending," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(2), pages 523-530.
    16. Eduardo Levy Yeyati, 2008. "Liquidity Insurance in a Financially Dollarized Economy," NBER Chapters, in: Financial Markets Volatility and Performance in Emerging Markets, pages 185-218, National Bureau of Economic Research, Inc.
    17. Maurizio Michael Habib & Mark Joy, 2010. "Foreign-currency bonds: currency choice and the role of uncovered and covered interest parity," Applied Financial Economics, Taylor & Francis Journals, vol. 20(8), pages 601-626.
    18. Cordella, Tito & Powell, Andrew, 2021. "Preferred and non-preferred creditors," Journal of International Economics, Elsevier, vol. 132(C).
    19. Anderson, Ronald W. & Gilbert, Christopher L, 1989. "Securitization and Commodity Contingency in International Lending," CEPR Discussion Papers 295, C.E.P.R. Discussion Papers.
    20. Eduardo Levy Yeyati, 2009. "Optimal Debt? On the Insurance Value of International Debt Flows to Developing Countries," Open Economies Review, Springer, vol. 20(4), pages 489-507, September.
    21. Buiter, Willem H. & Sibert, Anne, 1999. "UDROP: A Small Contribution to the New International Financial Architecture," CEPR Discussion Papers 2138, C.E.P.R. Discussion Papers.
    22. Olivier J. Blanchard & Paolo Mauro & Julien Acalin, 2016. "The Case for Growth-Indexed Bonds in Advanced Economies Today," Policy Briefs PB16-2, Peterson Institute for International Economics.
    23. Miyajima, Ken & Mohanty, M.S. & Chan, Tracy, 2015. "Emerging market local currency bonds: Diversification and stability," Emerging Markets Review, Elsevier, vol. 22(C), pages 126-139.
    24. Eduardo Levy Yeyati, 2021. "Financial dollarization and de-dollarization in the new millennium," Department of Economics Working Papers wp_gob_2021_02, Universidad Torcuato Di Tella.
    25. Mr. Philippe Beaugrand & Mr. Montfort Mlachila & Mr. Boileau Loko, 2002. "The Choice Between External and Domestic Debt in Financing Budget Deficits: The Case of Central and West African Countries," IMF Working Papers 2002/079, International Monetary Fund.
    26. Stijn Claessens & Daniela Klingebiel & Sergio L. Schmukler, 2007. "Government Bonds in Domestic and Foreign Currency: the Role of Institutional and Macroeconomic Factors," Review of International Economics, Wiley Blackwell, vol. 15(2), pages 370-413, May.
    27. Ize, Alain & Yeyati, Eduardo Levy, 2003. "Financial dollarization," Journal of International Economics, Elsevier, vol. 59(2), pages 323-347, March.
    28. Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 473-491, June.
    29. Mr. Luca A Ricci & Mr. Marcos d Chamon & Alejo Costa, 2008. "Is There a Novelty Premium on New Financial Instruments? The Argentine Experience with GDP-Indexed Warrants," IMF Working Papers 2008/109, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Valencia, Oscar & Rodriguez, Luis Alberto & Siachoque, Juan Pablo, 2023. "Fiscal Rules and Optimal Currency Composition of Sovereign Debt in Emerging Economies," IDB Publications (Working Papers) 12682, Inter-American Development Bank.
    2. Matthew Theobald, 2023. "Heterogeneity in the impact of risk on local currency borrowing," Indian Economic Review, Springer, vol. 58(2), pages 319-357, September.
    3. Miller, Marcus & Zhang, Lei, 2000. "Sovereign Liquidity Crises: The Strategic Case for a Payments Standstill," Economic Journal, Royal Economic Society, vol. 110(460), pages 335-362, January.
    4. Sunder-Plassmann, Laura, 2020. "Infation, default and sovereign debt: The role of denomination and ownership," Journal of International Economics, Elsevier, vol. 127(C).
    5. Ni, Yinan & Barth, James R. & Sun, Yanfei, 2022. "On the dynamic capital structure of nations: Theory and empirics," Research in International Business and Finance, Elsevier, vol. 62(C).
    6. Wenxin Du & Carolin E. Pflueger & Jesse Schreger, 2020. "Sovereign Debt Portfolios, Bond Risks, and the Credibility of Monetary Policy," Journal of Finance, American Finance Association, vol. 75(6), pages 3097-3138, December.
    7. Obregon, Carlos, 2018. "Globalización visiones equivocadas [Globalization misguided views]," MPRA Paper 86396, University Library of Munich, Germany.
    8. Levy Yeyati, Eduardo, 2008. "The cost of reserves," Economics Letters, Elsevier, vol. 100(1), pages 39-42, July.
    9. Obregon, Carlos, 2018. "Globalization misguided views," MPRA Paper 85813, University Library of Munich, Germany.
    10. Martin Melecky, 2012. "Choosing The Currency Structure Of Foreign‐Currency Debt: A Review Of Policy Approaches," Journal of International Development, John Wiley & Sons, Ltd., vol. 24(2), pages 133-151, March.
    11. Fernández-Arias, Eduardo & Hausmann, Ricardo, 2000. "What's Wrong with International Financial Markets?," IDB Publications (Working Papers) 1329, Inter-American Development Bank.
    12. Williamson, John, 2003. "Proposals for curbing the boom-bust cycle in the supply of capital to emerging markets," Copublicaciones, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 1791, September.
    13. Westerhout, Ed, 2021. "Inflation-Linked Bonds, Nominal Bonds, and Countercyclical Monetary Policies," Discussion Paper 2021-001, Tilburg University, Center for Economic Research.
    14. Niepelt, Dirk, 2014. "Debt maturity without commitment," Journal of Monetary Economics, Elsevier, vol. 68(S), pages 37-54.
    15. Jeffrey A. Frankel & Nouriel Roubini, 2001. "The Role of Industrial Country Policies in Emerging Market Crises," NBER Working Papers 8634, National Bureau of Economic Research, Inc.
    16. Eichengreen, Barry & Ruhl, Christof, 2001. "The bail-in problem: systematic goals, ad hoc means," Economic Systems, Elsevier, vol. 25(1), pages 3-32, March.
    17. Hiro Ito & Cesar M. Rodriguez, 2020. "Clamoring for greenbacks: Explaining the resurgence of the U.S. dollar in international debt," International Finance, Wiley Blackwell, vol. 23(3), pages 370-391, December.
    18. Yasin Kursat Onder & Enes Sunel, 2021. "Inflation-default trade-off without a nominal anchor: The case of Greece," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 39, pages 55-78, January.
    19. Konstantin Egorov & Dmitry Mukhin, 2020. "Optimal Policy under Dollar Pricing," Working Papers w0261, New Economic School (NES).
    20. Cordella, Tito & Powell, Andrew, 2021. "Preferred and non-preferred creditors," Journal of International Economics, Elsevier, vol. 132(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aoz:wpaper:265. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Laura Inés D Amato (email available below). General contact details of provider: https://edirc.repec.org/data/redniar.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.