000			01696nam a2200205Ia 4500
008			140323b2006 xxu||||| |||| 00| 0 eng d
082			_a332.6
100			_aHostland, Doug _923857
245			_aAssessing debt sustainability in emerging market economies using stochastic simulation methods _cHostland, Doug
260			_aWashington, D.C. _bThe World Bank _c2006
300			_a34 p.
440			_aPolicy Research Working Paper, no. 3821 _923858
500			_aIncludes bibliographical references
520			_a"2The authors apply stochastic simulation methods to assess debt sustainability in emerging market economies and provide probability measures for projections of the external and public debt burden over the medium term. The vulnerability of public debt to adverse shocks is determined by a number of interrelated factors, including the volatility of output, financial fragility, the endogenous response of the risk premium, and sudden stops in private capital flows. The vulnerability of external debt is sensitive to the determination of the exchange rate and to the pricing of traded goods. The authors show that fiscal policy can act in a preemptive manner to prevent the debt burden from rising significantly over the medium term. This requires flexibility in fiscal planning, which many emerging market economies lack. Emerging market economies therefore face a difficult trade off between managing the risk of a debt crisis and pursuing other important fiscal policy objectives. ""--World Bank web site."
650			_aStochastic analysis
650			_aFiscal policy - Developing countries.
700			_aKaram, Philippe _923860
942			_cBK
999			_c296716 _d296716