LDC participation in international financial markets. Debt and reserves

Jonathan Eaton, Mark Gersovitz

Research output: Contribution to journalArticlepeer-review

57 Scopus citations

Abstract

This paper analyzes LDC borrowing and reserve-holding behavior as part of a general equilibrium portfolio problem. Estimates of LDC debt and reserve demand and credit supply suggest that debt, along with reserves, serves a transactions role. Another finding is that most LDC borrowers are credit constrained. An analysis of LDC export behavior suggests that defaults are likely to be independent, uncorrelated phenomena.

Original languageEnglish (US)
Pages (from-to)3-21
Number of pages19
JournalJournal of Development Economics
Volume7
Issue number1
DOIs
StatePublished - 1980

All Science Journal Classification (ASJC) codes

  • Development
  • Economics and Econometrics

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