Sovereign Defaults and Expropriations : Empirical Regularities
This paper uses a large cross-country dataset to empirically examine factors associated with sovereign defaults on external private creditors and expropriation of foreign direct investments in developing countries since the 1970s. In the long run,...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2012/10/16793520/sovereign-defaults-expropriations-empirical-regularities http://hdl.handle.net/10986/12055 |
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okr-10986-120552021-04-23T14:02:59Z Sovereign Defaults and Expropriations : Empirical Regularities Eden, Maya Kraay, Aart Qian, Rong AFFILIATED ORGANIZATIONS ARREARS ARREARS ACCUMULATION ASSETS BANK BORROWERS BILATERAL CREDITORS BONDHOLDERS BREACH OF CONTRACT CAPITAL MARKETS CASE OF DEFAULT CASE OF DEFAULTS CHECKS CLAIM COMMODITY COMMODITY PRICES CONSUMPTION SMOOTHING COUNTRY FIXED EFFECT COUNTRY FIXED EFFECTS CREDITWORTHINESS CURRENCY CURRENCY DEVALUATION DEBT DEBT ACCUMULATION DEBT CRISES DEBT CRISIS DEBT OUTSTANDING DEBT RENEGOTIATION DEBT SERVICING DEBT STOCK DEBTORS DEBTS DEFAULT RISK DEMOCRACY DEPENDENT DEVELOPING COUNTRIES DISBURSEMENTS DIVESTMENT DOLLAR VALUE DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMIC SHOCK ENFORCEMENT MECHANISMS EXCESSIVE DEBT EXCESSIVE DEBT ACCUMULATION EXPOSURE EXPROPRIATION EXPROPRIATIONS EXTERNAL DEBT FINANCIAL CRISES FOREIGN ASSETS FOREIGN COMPANIES FOREIGN CREDITORS FOREIGN DIRECT INVESTMENT FOREIGN DIRECT INVESTMENTS FOREIGN DIRECT INVESTORS FOREIGN ENTERPRISE FOREIGN ENTERPRISES FOREIGN INVESTMENT FOREIGN INVESTORS GOVERNMENT REVENUE GROWTH RATE GROWTH RATES HIGH DEBT IMPLICIT CONTRACTS INCOME INCOME LEVEL INCOME LEVELS INDEBTED INDEBTED POOR COUNTRIES INSURANCE INSURANCE CLAIMS INSURER INSURERS INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL DEBT INTERNATIONAL ECONOMICS INTERNATIONAL MARKET INTERNATIONAL RESERVE INTERNATIONAL TRADE LEGAL MECHANISM LENDERS LEVEL OF DEBT LEVELS OF DEBT LEVY LOW-INCOME COUNTRIES LOWER DEBT MARKET ACCESS MULTILATERAL CREDITORS MULTILATERAL INVESTMENT GUARANTEE AGENCY NATIONAL SECURITY NATURAL RESOURCE NATURAL RESOURCES NPL OIL PRICE OPEN ECONOMY OUTPUT OUTPUT LOSS POLICY RESPONSE POLITICAL ECONOMY POLITICAL RISK POLITICAL RISK INSURANCE POLITICAL SYSTEM PORTFOLIO PRIVATE CREDITORS PRIVATE INVESTMENT PRIVATIZATION PRIVATIZATIONS REMEDY RENEGOTIATION REPAYMENT REPUDIATION REPUTATIONS RESERVE RETURNS RISK OF DEFAULT RISK OF EXPROPRIATION RISK OF EXPROPRIATIONS SECONDARY MARKETS SEIZURES SHORT-TERM DEBT SOVEREIGN DEBT SOVEREIGN DEBT MARKETS SOVEREIGN DEFAULT SOVEREIGN DEFAULTS SOVEREIGN RISK STOCK OF DEBT STOCKS SYSTEMIC RISK THIRD WORLD TIME OF DEFAULT TURNOVER VALUE OF DEBT VOLATILITY This paper uses a large cross-country dataset to empirically examine factors associated with sovereign defaults on external private creditors and expropriation of foreign direct investments in developing countries since the 1970s. In the long run, sovereign defaults and expropriations are likely to occur in the same countries. In the short run, however, these events are uncorrelated. Defaults are more likely to occur following periods of rapid debt accumulation, when growth is low, and in countries with weak policy performance, and defaults are not strongly persistent over time. In contrast, expropriations are not systematically related to the level of foreign direct investment, to growth, or to policy performance. Expropriations are however less likely under right-wing governments, and are strongly persistent over time. There is also little evidence that a history of recent defaults is associated with expropriations, and vice versa. The paper discusses the implications of these findings for models that emphasize retaliation as means for sustaining sovereign borrowing and foreign investment in equilibrium, as well as the implications for political risk insurance against the two types of events. 2013-01-02T21:57:04Z 2013-01-02T21:57:04Z 2012-10 http://documents.worldbank.org/curated/en/2012/10/16793520/sovereign-defaults-expropriations-empirical-regularities http://hdl.handle.net/10986/12055 English en_US Policy Research Working Paper; No. 6218 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |
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Digital Repository |
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Foreign Institution |
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Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
| language |
English en_US |
| topic |
AFFILIATED ORGANIZATIONS ARREARS ARREARS ACCUMULATION ASSETS BANK BORROWERS BILATERAL CREDITORS BONDHOLDERS BREACH OF CONTRACT CAPITAL MARKETS CASE OF DEFAULT CASE OF DEFAULTS CHECKS CLAIM COMMODITY COMMODITY PRICES CONSUMPTION SMOOTHING COUNTRY FIXED EFFECT COUNTRY FIXED EFFECTS CREDITWORTHINESS CURRENCY CURRENCY DEVALUATION DEBT DEBT ACCUMULATION DEBT CRISES DEBT CRISIS DEBT OUTSTANDING DEBT RENEGOTIATION DEBT SERVICING DEBT STOCK DEBTORS DEBTS DEFAULT RISK DEMOCRACY DEPENDENT DEVELOPING COUNTRIES DISBURSEMENTS DIVESTMENT DOLLAR VALUE DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMIC SHOCK ENFORCEMENT MECHANISMS EXCESSIVE DEBT EXCESSIVE DEBT ACCUMULATION EXPOSURE EXPROPRIATION EXPROPRIATIONS EXTERNAL DEBT FINANCIAL CRISES FOREIGN ASSETS FOREIGN COMPANIES FOREIGN CREDITORS FOREIGN DIRECT INVESTMENT FOREIGN DIRECT INVESTMENTS FOREIGN DIRECT INVESTORS FOREIGN ENTERPRISE FOREIGN ENTERPRISES FOREIGN INVESTMENT FOREIGN INVESTORS GOVERNMENT REVENUE GROWTH RATE GROWTH RATES HIGH DEBT IMPLICIT CONTRACTS INCOME INCOME LEVEL INCOME LEVELS INDEBTED INDEBTED POOR COUNTRIES INSURANCE INSURANCE CLAIMS INSURER INSURERS INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL DEBT INTERNATIONAL ECONOMICS INTERNATIONAL MARKET INTERNATIONAL RESERVE INTERNATIONAL TRADE LEGAL MECHANISM LENDERS LEVEL OF DEBT LEVELS OF DEBT LEVY LOW-INCOME COUNTRIES LOWER DEBT MARKET ACCESS MULTILATERAL CREDITORS MULTILATERAL INVESTMENT GUARANTEE AGENCY NATIONAL SECURITY NATURAL RESOURCE NATURAL RESOURCES NPL OIL PRICE OPEN ECONOMY OUTPUT OUTPUT LOSS POLICY RESPONSE POLITICAL ECONOMY POLITICAL RISK POLITICAL RISK INSURANCE POLITICAL SYSTEM PORTFOLIO PRIVATE CREDITORS PRIVATE INVESTMENT PRIVATIZATION PRIVATIZATIONS REMEDY RENEGOTIATION REPAYMENT REPUDIATION REPUTATIONS RESERVE RETURNS RISK OF DEFAULT RISK OF EXPROPRIATION RISK OF EXPROPRIATIONS SECONDARY MARKETS SEIZURES SHORT-TERM DEBT SOVEREIGN DEBT SOVEREIGN DEBT MARKETS SOVEREIGN DEFAULT SOVEREIGN DEFAULTS SOVEREIGN RISK STOCK OF DEBT STOCKS SYSTEMIC RISK THIRD WORLD TIME OF DEFAULT TURNOVER VALUE OF DEBT VOLATILITY |
| spellingShingle |
AFFILIATED ORGANIZATIONS ARREARS ARREARS ACCUMULATION ASSETS BANK BORROWERS BILATERAL CREDITORS BONDHOLDERS BREACH OF CONTRACT CAPITAL MARKETS CASE OF DEFAULT CASE OF DEFAULTS CHECKS CLAIM COMMODITY COMMODITY PRICES CONSUMPTION SMOOTHING COUNTRY FIXED EFFECT COUNTRY FIXED EFFECTS CREDITWORTHINESS CURRENCY CURRENCY DEVALUATION DEBT DEBT ACCUMULATION DEBT CRISES DEBT CRISIS DEBT OUTSTANDING DEBT RENEGOTIATION DEBT SERVICING DEBT STOCK DEBTORS DEBTS DEFAULT RISK DEMOCRACY DEPENDENT DEVELOPING COUNTRIES DISBURSEMENTS DIVESTMENT DOLLAR VALUE DUMMY VARIABLE ECONOMIC DEVELOPMENT ECONOMIC SHOCK ENFORCEMENT MECHANISMS EXCESSIVE DEBT EXCESSIVE DEBT ACCUMULATION EXPOSURE EXPROPRIATION EXPROPRIATIONS EXTERNAL DEBT FINANCIAL CRISES FOREIGN ASSETS FOREIGN COMPANIES FOREIGN CREDITORS FOREIGN DIRECT INVESTMENT FOREIGN DIRECT INVESTMENTS FOREIGN DIRECT INVESTORS FOREIGN ENTERPRISE FOREIGN ENTERPRISES FOREIGN INVESTMENT FOREIGN INVESTORS GOVERNMENT REVENUE GROWTH RATE GROWTH RATES HIGH DEBT IMPLICIT CONTRACTS INCOME INCOME LEVEL INCOME LEVELS INDEBTED INDEBTED POOR COUNTRIES INSURANCE INSURANCE CLAIMS INSURER INSURERS INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL DEBT INTERNATIONAL ECONOMICS INTERNATIONAL MARKET INTERNATIONAL RESERVE INTERNATIONAL TRADE LEGAL MECHANISM LENDERS LEVEL OF DEBT LEVELS OF DEBT LEVY LOW-INCOME COUNTRIES LOWER DEBT MARKET ACCESS MULTILATERAL CREDITORS MULTILATERAL INVESTMENT GUARANTEE AGENCY NATIONAL SECURITY NATURAL RESOURCE NATURAL RESOURCES NPL OIL PRICE OPEN ECONOMY OUTPUT OUTPUT LOSS POLICY RESPONSE POLITICAL ECONOMY POLITICAL RISK POLITICAL RISK INSURANCE POLITICAL SYSTEM PORTFOLIO PRIVATE CREDITORS PRIVATE INVESTMENT PRIVATIZATION PRIVATIZATIONS REMEDY RENEGOTIATION REPAYMENT REPUDIATION REPUTATIONS RESERVE RETURNS RISK OF DEFAULT RISK OF EXPROPRIATION RISK OF EXPROPRIATIONS SECONDARY MARKETS SEIZURES SHORT-TERM DEBT SOVEREIGN DEBT SOVEREIGN DEBT MARKETS SOVEREIGN DEFAULT SOVEREIGN DEFAULTS SOVEREIGN RISK STOCK OF DEBT STOCKS SYSTEMIC RISK THIRD WORLD TIME OF DEFAULT TURNOVER VALUE OF DEBT VOLATILITY Eden, Maya Kraay, Aart Qian, Rong Sovereign Defaults and Expropriations : Empirical Regularities |
| relation |
Policy Research Working Paper; No. 6218 |
| description |
This paper uses a large cross-country
dataset to empirically examine factors associated with
sovereign defaults on external private creditors and
expropriation of foreign direct investments in developing
countries since the 1970s. In the long run, sovereign
defaults and expropriations are likely to occur in the same
countries. In the short run, however, these events are
uncorrelated. Defaults are more likely to occur following
periods of rapid debt accumulation, when growth is low, and
in countries with weak policy performance, and defaults are
not strongly persistent over time. In contrast,
expropriations are not systematically related to the level
of foreign direct investment, to growth, or to policy
performance. Expropriations are however less likely under
right-wing governments, and are strongly persistent over
time. There is also little evidence that a history of recent
defaults is associated with expropriations, and vice versa.
The paper discusses the implications of these findings for
models that emphasize retaliation as means for sustaining
sovereign borrowing and foreign investment in equilibrium,
as well as the implications for political risk insurance
against the two types of events. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Eden, Maya Kraay, Aart Qian, Rong |
| author_facet |
Eden, Maya Kraay, Aart Qian, Rong |
| author_sort |
Eden, Maya |
| title |
Sovereign Defaults and Expropriations : Empirical Regularities |
| title_short |
Sovereign Defaults and Expropriations : Empirical Regularities |
| title_full |
Sovereign Defaults and Expropriations : Empirical Regularities |
| title_fullStr |
Sovereign Defaults and Expropriations : Empirical Regularities |
| title_full_unstemmed |
Sovereign Defaults and Expropriations : Empirical Regularities |
| title_sort |
sovereign defaults and expropriations : empirical regularities |
| publisher |
World Bank, Washington, DC |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2012/10/16793520/sovereign-defaults-expropriations-empirical-regularities http://hdl.handle.net/10986/12055 |
| _version_ |
1764418880127631360 |