We develop a model for analyzing the sovereign debt crises of 20102013 in the Eurozone. The government sets its expenditure-debt policy optimally. The need to sell large quantities of bonds every peri
During the 1990s and the 2000s a variety of crises affected the stability of international capital markets: from the European Monetary System crisis in 1992-93 and the emerging market crises to today’
Organisation for Economic Co-operation and Development30
In this paper we analyze the recent efforts of the international financial institutions to limit the moral hazard created by their assistance to crisis countries. We question the wisdom of the case-by
