Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/106174
Authors: 
Schröder, Christoph
Year of Publication: 
2014
Series/Report no.: 
ZEW Discussion Papers 14-126
Abstract: 
This paper complements the empirical literature on sovereign debt restructurings by analyzing potential determinants of (near-term) follow-up restructurings after a restructuring has taken place. The probability of follow-up restructurings is estimated by means of survival models using a unique dataset provided by Cruces and Trebesch (2013). I find that more comprehensive debt remissions decrease the probability of serial restructurings significantly. Moreover, reductions in net present value due to outright face value haircuts reduce the probability of serial restructurings more strongly than equally sized reductions in net present value due to maturity extensions and/or interest rate reductions. One possible explanation may be found in the timing of debt remissions: While a cut in face value provides direct and instant relief, maturity exten-sions and/or lower interest rates only unburden a country slowly over time.
Subjects: 
serial restructurings
sovereign debt restructuring
sovereign debt haircuts
JEL: 
F34
H63
N20
Document Type: 
Working Paper

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