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The Interplay Between Public and Private External Debt Stocks
Author(s) -
Brzozowski Michał,
SiwińskaGorzelak Joanna
Publication year - 2016
Publication title -
international finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.458
H-Index - 39
eISSN - 1468-2362
pISSN - 1367-0271
DOI - 10.1111/infi.12095
Subject(s) - external debt , internal debt , monetary economics , debt , financial system , debt levels and flows , economics , openness to experience , stock (firearms) , recourse debt , loan , bond , business , finance , mechanical engineering , social psychology , psychology , engineering
Abstract Using a sample of 48 emerging and developing countries in the 1970–2012 period, we investigated the interactions between the stock of sovereign debt and the quantity of corporate external borrowing. We found that public external debt hinders private‐sector access to external loan and bond markets. By contrast, the stock of private debt in international financial markets exerts a positive influence on public external debt from all sources except other private creditors. We also found the incidence of bank crises, capital account openness and the rate of economic growth to be among the macroeconomic variables that have a significant impact on both public and private external debts.