Silvia Marchesi, Tania Masi, 06 July 2018

Euro area governments have just negotiated a debt relief agreement for Greece, but without face-value debt reduction. This column argues that specific characteristics of sovereign debt renegotiations have significant economic implications. When debt relief operations involve write-offs, the defaulting country benefits strongly in term of growth up to ten years after the restructuring. 

Matthias Heinz, Sabrina Jeworrek, Vanessa Mertins, Heiner Schumacher, Matthias Sutter, 15 December 2017

Any organisation that needs to restructure, cut wages, or make layoffs needs to know how the employees who are not affected will respond. This column presents a field experiment which revealed that the perception that employers are unfair – in this case, as a result of layoffs – reduces the performance of employees who have not been not directly affected. As part of the experiment, experienced HR managers were able to successfully anticipate the consequences of unfair employer behaviour on unaffected workers.

Gregori Galofré-Vilà, Martin McKee, Christopher Meissner, David Stuckler, 09 October 2016

In 1953, the Western Allied powers approved the London Debt Agreement, a radical plan to eliminate half of Germany’s external debt and create generous repayment conditions for the remainder. Using new data from the historical monthly reports of the Deutsche Bundesbank, this column argues that the agreement spurred economic growth by creating fiscal space for public investment, lowering costs of borrowing, and stabilising inflation.

Carmen Reinhart, Christoph Trebesch, 21 October 2014

To work towards resolving Europe’s ongoing debt crisis this column looks to the past. From the recent emerging market debt crisis (1980s-2000s) and the interwar episode of the 1920s-1930s we learn that debt write-downs and defaults are able to be postponed but not prevented. Punishment for default is temporary, sometimes followed by a renewed surge in borrowing that leads to another crisis.

Udaibir Das, Michael Papaioannou, Christoph Trebesch, 28 November 2012

There is an ongoing debate about debt restructurings, debt buybacks and other strategies to resolve sovereign debt crises. Unfortunately there is limited empirical knowledge about the process and outcome of past restructurings to guide the debate and help tackle future crises. This column is an attempt to fill this gap by surveying new data and lessons learned from debt crises of the past six decades.

Philippe Legrain, 02 November 2010

While the debate over global imbalances often focuses on China, this column argues that the biggest threat to the world economy comes from the other side of the seesaw – the US.

Events

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