| Fecha: |
2018 |
| Resumen: |
In the standard model of sovereign default, as in Aguiar and Gopinath (2006) or Arellano (2008), default is driven by fundamentals alone. There is no independent role for expectations. We show that small variations of that model are consistent with multiple interest rate equilibria, similar to the ones found in Calvo (1988). For distributions of output that are commonly used in the literature, the high interest rate equilibria have properties that make them fragile. Once output is drawn from a distribution with both good and bad times, however, it is possible to have robust high interest rate equilibria. |
| Resumen: |
The ADEMU Working Paper Series is being supported by the European Commission Horizon 2020 European Union funding for Research & Innovation, grant agreement No 649396. |
| Ayudas: |
European Commission 649396
|
| Derechos: |
Aquest document està subjecte a una llicència d'ús Creative Commons. Es permet la reproducció total o parcial, la distribució, la comunicació pública de l'obra i la creació d'obres derivades, fins i tot amb finalitats comercials, sempre i quan es reconegui l'autoria de l'obra original.  |
| Lengua: |
Anglès |
| Colección: |
Barcelona Graduate School of Economics. ADEMU working paper series |
| Colección: |
ADEMU Working Paper Series ; 86 |
| Documento: |
Working paper |
| Materia: |
Sovereign default ;
Multiple equilibria ;
Good and bad times |
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