Endogenous debt crises: CEPR paper
A Centre for Economic Policy Research (CEPR) paper published on Monday shows that debt crises are just as likely the result of borrowers' behaviour as they are of low growth productivity.
Daniel Cohen and Sébastien Villemot, the paper's authors, distinguish between two types of debt crises - those that are the outcome of exogenous shocks to productivity growth and those that are endogenously created, either by self-fulfilling panic in financial markets or by the reckless behaviour of Panglossian
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