Series: IMF Working Papers
Author(s): Gabriel Desgranges , and Celine Rochon
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 12 September 2014
Keywords: Long Term Debt, Maturity Structure, Optimal Default, Sovereign Debt Crisis, Uncertainty, debt portfolio, debt burden, sovereign debt, hedging, financial institutions
We study the relationship between default and the maturity structure of the debt portfolio of a Sovereign, under uncertainty. The Sovereign faces a trade-off between a future costly default and a high current fisca...