Can HIPCs Use Hyper-Incentives?

Hyper-incentive contracts (Menzies 2004) can be used to pursue humanitarian goals (providing a safety net) while allowing creditors to offer innovative repayment friendly contracts to debtors (eliminating a debt overhang). Both the contract of Krugman (1988) and the hyper-incentive contract are illustrated with some calculations based on current Highly Indebted Poor Countries (HIPCs). The outcomes for the two contracts are similar, but the twelve countries examined could each benefit by an average amount of $US2002100 million under a hyper-incentive contract


Issue Date:
2008
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/50012
Published in:
Review of Applied Economics, Volume 04, Number 1-2
Page range:
113-124
Total Pages:
12
JEL Codes:
F34




 Record created 2017-04-01, last modified 2017-08-25

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