The Library
Bargaining and sustainability: the Argentine debt swap of 2005
Tools
Dhillon, Amrita, García Fronti, Javier I., Ghosal, Sayantan and Miller, Marcus (2005) Bargaining and sustainability: the Argentine debt swap of 2005. Discussion Paper. London: Centre for Economic Policy Research (Great Britain). Discussion paper (Centre for Economic Policy Research (Great Britain)) (No.523).
|
PDF
WRAP_Miller_CEPR-DP5236[1].pdf - Requires a PDF viewer. Download (191Kb) |
Official URL: http://www.cepr.org/pubs/new-dps/dplist.asp?dpno=5...
Abstract
When Argentine sovereign default in December 2001 led to a collapse of the peso, the burden of dollar debt became demonstrably unsustainable. But it was not clear what restructuring was feasible, nor when. Eventually, in 2005 after a delay of more than three years, a supermajority of creditors accepted a swap implying a recovery rate of around 37 cents in the dollar. In this paper a bargaining approach is used to explain both the settlement and the delay. We conclude that the agreed swap broadly corresponds to a bargaining outcome where the Argentine government had 'first mover' advantage, and that a substantial delay occurred as negotiators seeking a sustainable settlement waited for economic recovery. Factors not explicit in the formal framework are also considered - heterogeneity of creditors, for example, and the role of third parties in promoting 'good faith' bargaining.
Item Type: | Working or Discussion Paper (Discussion Paper) | ||||
---|---|---|---|---|---|
Subjects: | F History United States, Canada, Latin America > F1201 Latin America (General) H Social Sciences > HJ Public Finance |
||||
Divisions: | Faculty of Social Sciences > Economics | ||||
Library of Congress Subject Headings (LCSH): | Money -- Argentina, Debts, Public -- Argentina, Financial crises -- Argentina, Sustainable development -- Argentina, Argentina -- Economic conditions -- 1983- | ||||
Series Name: | Discussion paper (Centre for Economic Policy Research (Great Britain)) | ||||
Publisher: | Centre for Economic Policy Research (Great Britain) | ||||
Place of Publication: | London | ||||
Official Date: | September 2005 | ||||
Dates: |
|
||||
Number: | No.523 | ||||
Number of Pages: | 37 | ||||
Institution: | University of Warwick | ||||
Status: | Not Peer Reviewed | ||||
Access rights to Published version: | Open Access (Creative Commons) | ||||
Funder: | Economic and Social Research Council (Great Britain) (ESRC), University of Warwick. Centre for the Study of Globalisation and Regionalisation (CSGR) | ||||
Grant number: | RES-051-27-0125 (ESRC) |
Request changes or add full text files to a record
Repository staff actions (login required)
View Item |