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This article addresses the questions of whether, to what extent, and how China contests the norms and practices for public debt management in developing countries as currently preferred by the Group of Seven (G7) and G7-led multilateral institutions. More specifically, it considers three norms: debt sustainability, debt transparency and conditional debt relief. To that end, I elaborate a norm contestation typology and apply it to analyse how China discursively contests these norms. Equally, I contrast China's rhetoric with its actual behaviours. Two findings emerge from the analysis. First, there are notable efforts by China to contest the three norms, with Chinese officials emphasising a qualitatively distinct understanding of debt sustainability and debt transparency and the appropriateness of non-conditionality and equality in the provision of debt relief. Second, there is an apparent disjunction between China's words and actions, with its actual lending and debt relief practices (becoming) more aligned with what is currently preferred or advocated by the established actors. [ABSTRACT FROM AUTHOR]

Scholarship on sovereign debt emphasizes the importance of central banks in backstopping markets, but less attention has been devoted to the interactions of debt management offices with private finance. To fill this gap, this article examines the market-based operations of debt management offices alongside those of central banks. Debt management has played a crucial role in constructing and nurturing liquidity conditions in primary and secondary markets for sovereign debt through the contracting of primary dealers as monetary and fiscal policy partners, the embrace of repo markets, and later, through the creation of special liquidity facilities. Co-working in the collateral factory of the modern financial system creates new forms of entanglements that we term the 'collateral triangle', linking together central banking, debt management, and primary dealer operations in a shared convergence on repo finance as integral to public sector governability and private sector business models. Debt management and central banking jointly created and now maintain the infrastructures of this 'collateral triangle', not least because the inherent stability risks of repo markets threaten market-based monetary policy and market-based debt management. Routine de-risking by both actors is a core feature of the collateral system. [ABSTRACT FROM AUTHOR]

Emerging economies experiencing energy-intensive growth face increased energy price volatility, which could fuel macroeconomic instability with possible implications on their debt repayment capacity. This study implements a quantile vector autoregressive model on a dataset collected between April 2011 and July 2024 to examine the interplay among economic uncertainty, energy-related risks and sovereign risk in BRICS economies. The empirical results show these risk factors exhibit strong interconnectedness under low- and high-risk profiles. Under a low-risk profile, energy risks are transmitters in all countries except Russia and India. Sovereign risk receives shocks in Brazil, India and South Africa but transmits shocks in Russia and China, whereas economic risk is a shock transmitter in South Africa and India and plays the receiver role in Brazil, Russia and China. In high-risk conditions, economic risk is a shock transmitter in Russia and India but receives shocks in Brazil, China, and South Africa; Sovereign risk receives shocks in all countries except China while energy risk is a transmitter across countries except Russia. Therefore, the dynamics of the studied risks are driven by individual country heterogeneities including risk profile, economic structure, market conditions and energy trade status. Policymakers should combine energy, economic and debt management policies to promote economic stability and build crisis resilience. In conclusion, debt management and investment in renewable energy are alternative policy instruments to promote creditworthiness in emerging countries. [ABSTRACT FROM AUTHOR]

Scant attention has been paid to the racial impacts of bankruptcy and foreclosure in the United States. This article examines the links between bankruptcy, housing loss, and "risk responsibilization," a neoliberal process in which consumers rather than lending institutions are held responsible for debt management. We used data sequencing, and Geographic Information Systems Mapping (GIS) to analyse 1,057 cases of home foreclosure and related bankruptcies from 2016 to 2019 in a Deep South US County. We found housing vulnerability to be a racialized process, with Black homeowners more likely to face foreclosure and less likely to receive a fresh start through bankruptcy. In foreclosure, Black-owned homes were more likely to convert to rental property. The study provides sequential and spatial evidence of connections between risk responsibilization, systemic racism, and housing loss in the geography of dispossession. [ABSTRACT FROM AUTHOR]

The dominant interpretation of Italian economic stagnation in the last decades is that this is due to insufficient liberalisation, but an alternative explanation emphasises the unintended consequences of Italy's strategy of tying itself to the European mast ('external constraint'). Based on historical reconstructions of three policy areas, public debt management, privatisation, and labour market policy, this paper seeks to adjudicate between these two rival accounts. It argues that insufficient liberalisation fails to explain the Italian trajectory. The external constraint does a better job of explanation, but more as a necessary condition for stagnation than as a sufficient one. In other words, it would probably have been possible to manage the external constraint differently to produce better outcomes, but without the external constraint, the Italian stagnation would likely have been less deep. [ABSTRACT FROM AUTHOR]

Illicit drug markets have long been associated with violence as a mode of regulating market behavior, especially regarding debts linked to drug purchase. While a growing literature examines violent and nonviolent modes of ensuring repayment by dealers and lenders, little research has focused on strategies of buyers and borrowers in navigating drug debt. Drawing on interviews with 75 people who use drugs within a materially disadvantaged neighborhood, we explore experiences in managing debt to dealers and within social networks adjacent to drug markets. Findings describe complex strategies to protect reputation, foster relationships with dealers, and employ cooperative, assertive, or coercive tactics to negotiate credit arrangements that sustain and stabilize the drug market while mitigating violent retaliation for unpaid debt. Findings also elucidate informal credit arrangements within social networks, identifying reciprocity and self-control as constitutive of social capital within friendship groups that serve as financial and social safety nets. This research considers socially embedded, boundedly rational decisions of marginalized drug market actors, highlighting diverse financial management practices among structurally vulnerable borrowers that serve economic and social goals while seeking to mitigate the risk of violence. [ABSTRACT FROM AUTHOR]

Climate change impact on sovereign debt management has become an issue of great concern. The aim of this paper is to analyse the changes in the traditional approach of sovereign debt managers in the face of the pursued climate policy and different scenarios of climate liabilities for 2050. We follow a novel three-fold research approach: 1) assessment of the estimated level of current climate liabilities based on the Fiscal Risk Matrix; 2) performing forward-looking climate debt projections over the timeframe 2025-2050 for the EU countries; 3) conducting case study research on EU countries, to identify the sovereign climate debt management activities undertaken so far and to define a series of good-practice guidelines. Findings indicate a growing role of the climate financial mechanisms in sovereign debt management. In particular, our climate scenario approach reveals those scenarios in which a country's fiscal position indicators are more vulnerable from the standpoint of rising public expenditure due to the country's inability to manage CO2 gas emissions. Each country is responsible for its climate pathway by 2050 and this will be mainly determined by the timeliness, efficacy and appropriateness of the public policies and measures implemented to mitigate climate change. [ABSTRACT FROM AUTHOR]

There has been a long debate as to which of the most extended systems, the uniform system or the discriminatory price system, is the most appropriate for central banks and debt management offices issuing sovereign bonds. The purpose of this paper is to shed light on this question. The main variables to explore the auction mechanisms are the price difference between the primary and secondary markets (price spread) and the coverage ratio. Subsequently, to determine patterns for clarifying which auction system is optimal, we propose a new model based on the price spread and a valuation model for financial options that covers both negative and positive spreads. We conclude that the auction method and the number of primary dealers are relevant parameters in the auction outcome. Finally, the results of the new model are the cornerstone for identifying detailed patterns followed by top-performing countries. [ABSTRACT FROM AUTHOR]

In theory, direct citizen engagement in budgeting helps local governments reflect the citizens' budget preferences more precisely, thereby enhancing citizen-government communication. However, the efficacies of budget participation remain ambiguous considering both its democratic values and the cost of deliberation. In this study, we test how direct citizen participation by means of participatory budgeting (PB) affects the financial condition of local governments. We use a sophisticated concept of financial condition that encompasses various abilities of local government. We measure the degree of citizen participation as the availability of institutional mechanisms associated with different levels of inclusiveness and authorities determined by South Korean local government ordinances of formal budget participation. Our empirical analysis based on South Korean local governments' data between 2012 and 2019 reveals that a PB institution with higher participation level further worsens the local financial condition. The adverse effects are mostly identified in the mid-term and long-term financial conditions, whereas the short-term financial condition remains unaffected. The findings imply that direct participation in theory corrects mismatches between bureaucratic and citizen priorities, but, in practice, the citizens may inappropriately direct mid- and long-term oriented public investment and debt management. [ABSTRACT FROM AUTHOR]

Popular media and politicians have often blamed the high public debt of some EU countries on cultural differences. These claims are most apparent in the discourse contrasting ostensibly prudent Northern Europeans with spendthrift Southern Europeans. Despite the prominence of these and similar narratives and evidence that culture plays a nontrivial role in other economic outcomes, there is no systematic evidence that culture influences attitudes towards sovereign debt in the EU. We provide the first empirical test of this claim using over 233,000 responses to a Eurobarometer question about the salience of national debt. Our analysis reveals that national and sub-national differences explain very little of the variance in debt preferences. Further, the differences that do emerge do not fit existing cultural narratives. Additional analysis reveals that established measures of national culture or religious observance, at the national and regional levels, do not correlate with debt attitudes as cultural arguments would predict. [ABSTRACT FROM AUTHOR]

The article focuses on a critical response to Elettra Stimilli's book, 'Debt and Guilt,' examining the nexus between neoliberal governance and the concepts of debt and guilt. It explores the transformation of guilt into economic indebtedness and analyzes how confession and verbalization contribute to the reproduction of the neoliberal logic of debt and guilt. It also investigates the impact of recent discursive shifts in a post-pandemic context on the enduring dynamics of debt and guilt.

The article focuses on Elettra Stimilli's book 'Debt and Guilt: A Political Philosophy,' which explores the contemporary existence of debt and its relationship to guilt. Stimilli's interdisciplinary approach combines political philosophy, economic theory, theology and anthropology to examine the religious origins of neoliberalism and the psychological impact of debt and guilt on the modern subject.

The article focuses on the emergence of economic theology as a paradigm in various disciplines, including political philosophy, sociology and cultural studies. It examines the concept of economic theology of neoliberalism and its impact on contemporary existence, particularly the notions of debt and guilt. It highlights the interdisciplinary approach taken by Elettra Stimilli's book, 'Debt and Guilt,' exploring the philosophical and historical aspects of debt.

China's central government has taken a more active and resolute attitude to solve the hidden debt problem, which has achieved positive results. However, the transformation of local government financing platforms is full of uncertainty, therefore the challenges of future implicit debt resolution have still to be met. As many developing countries are facing an increasing debt burden, China's exploration and experience in defusing local government debt risk may be of use to debt management and debt transparency in other countries. Since China's central government officially commented on the implicit debt in 2017, the government has been trying to eliminate the 'off balance sheet' or hidden debt. This article discusses the origin of implicit debt in China, the typical forms of implicit debt, the regulatory policies to make this debt transparent and bring it onto the balance sheets, as well as the effect current policies have had on the sources of debt. This article shows a comprehensive picture of the past, present and looks at the future of implicit government debt in China. [ABSTRACT FROM AUTHOR]

In this paper, we use an overlapping-generations model to estimate the optimal public debt level in terms of the growth-maximizing theory under changing demographics and examine the fiscal sustainability in China. The results suggest that the optimal level of public debt in China lies in a scope of 70% to 88%, which varies as a function of the driving force of the production, the number of children, and the subsidy policy for rearing the children. On the basis of fiscal space framework, we can conclude that China's public debt and thereby the fiscal position is sustainable in the near and medium terms. Sensitivity analyses and robustness tests also support our empirical findings. Our study provides insights into public debt management, population policy, and strategies for economic growth in China. [ABSTRACT FROM AUTHOR]

This paper explores whether institutional change brought about by financial inclusion results in sustainable debt management by households. We analyze household indebtedness and its various dimensions using primary data collected from 600 households across 3 districts of rural Kerala in India. We find that more than half of the sample households are indebted. Using flow and stock analysis, we assess the repayment capacity of households. While the flow analysis based on interest and income comparison shows that debt is sustainable, the stock analysis indicates an alarming debt situation considering the illiquid nature of land assets. Both agricultural and non-agricultural households appeared to be caught in a debt trap. Our econometric analyses show that socio-economic factors like education and age of the household head, main source of household income and household asset value without land, are significant determinants of household level indebtedness. [ABSTRACT FROM AUTHOR]

This article presents new data on the kingdom of Aragon's issue of sovereign debt 25 years earlier than the point at which there is routine documentation. The primary focus of this study is to examine how the representative institutions of this territory within the Crown of Aragon undertook the task of raising capital in financial markets. Contrary to a well-established historiographical perspective, this inland kingdom of the Iberian Peninsula and a supra-local political body called the Diputación employed advanced financial instruments that were used in major cities along the Mediterranean coast, and managed to attract investors. A chronological survey is undertaken of the evolution of this debt and how it shaped the kingdom's relationship to the monarchy, seeking to meet royal demands for extraordinary funding. This study of the management of public debt sheds light on deep structural changes that encompassed fiscality, the creation of new institutions and self-government. [ABSTRACT FROM AUTHOR]

In this study, we examine the trade-offs between earnings management (both accruals and real) and covenant violations by examining how they are associated with future accounting and stock market performance. We analyze a matched-pair sample of covenant violation firms with non-violation firms that have a similar risk of a covenant violation. We have three main findings. First, our evidence indicates that covenant violations are costly events for shareholders as lenders appear to use their control rights in ways that increase the likelihood of loan repayment but impose costs for shareholders. Second, there is limited evidence indicating covenant-related accrual-earnings management activities impose significant costs on shareholders, but we find shareholders are worse off following unsuccessful real earnings management. Third, our evidence indicates that, on average, shareholders at high violation risk firms are better off when their firms successfully engage in accruals earnings management to avoid a violation compared to shareholders at firms that violate a covenant but do not manage earnings. Thus, covenant-related earnings management may be in the best interests of shareholders and is not necessarily evidence of shareholder-manager agency conflicts. [ABSTRACT FROM AUTHOR]

This paper focuses on multi-period cash flow risk which is measured by the SD in dual-channel supply chain. The manufacturer offers a consignment contract to the retailer, exposing cash flow risk due to the payment delay. We analyze cash inflows, outflows, and netflows of each member in dual-channel supply chain. We also examine different influencing factors on the preference of cash flows in dual-channel supply chain and then provide some managerial implications to deal with cash flow risk. [ABSTRACT FROM AUTHOR]

This study aims to empirically test the effects of military expenditure on external debt of 35 arms importing countries by using the annual panel data from the year 1995 to 2016. The panel was divided into two income classes (upper-middle and lower-middle), and the basic sample was also divided into five different regions (Middle-East and North Africa, South and East Asia, Latin America, Europe and Central Asia, and Sub-Saharan Africa) to achieve further robustness in the study. The empirical results of pooled mean group estimators suggest that military expenditure generally increases the external debt burden in the studied countries. More specifically, it was noted that military expenditure decreases external debt in Europe and Central Asia. Moreover, it was found that the interaction term of military expenditure and growth rate is positive and significant in all of the sub-samples, except upper-middle class, the Middle East and North Africa, and Latin American regions. Thus, it may be concluded that military expenditure often increases external debt burden in countries where the debt management system is weak. Countries with weaker debt management systems need to devise economic policies that curtail their military expenditure, reduce their external debt and improve their economic condition. [ABSTRACT FROM AUTHOR]

This paper tackles one of the most recent issues in international and comparative political economy: the process of state financialization. Although research on global financial markets has revealed that states play a crucial role in private sector financialization, until recently, much less attention has been paid to state financialization itself. This includes both the measurement of cross-country variation and the question of why this process unfolds unevenly across political economies. We propose a perspective that focuses on two areas, the management of public debt and assets, and the various ways in which states are active in financial markets. Bridging material and cultural concepts in political economy, we differentiate between the reliance on financial markets as governance mechanism and the adoption of a sense-making framework grounded in financial economics and the shareholder-value model. We distill four indicators, trace cross-national and inter-temporal developments in 36 European countries since 1990, and explore how far this variation is associated with domestic and international political economic factors. The paper concludes that state and private sector financialization are mutually reinforcing processes. In addition, future research must pay strong attention to the tensions between finance and democracy as well as the distributive consequences of state financialization. [ABSTRACT FROM AUTHOR]

We analyzed the relationship between earnings management and the cost of debt using a sample of 3,503 Brazilian privately held companies. In doing so, we discuss the fundamentals of earnings management and the specific economics of privately held companies in Brazil and then hypothesize how these relationships come about. Our proxies for earnings management were modified Jones and modified Jones with ROA (return on assets). We then ran their residuals as explanatory variables for the cost of debt. Our findings point to the importance of earnings quality in privately held companies and the impact of earnings management on the cost of debt, suggesting that the higher the levels of earnings management, the higher the cost of debt, even when controlling by other variables that can influence this relationship. Our findings may also serve to encourage privately held companies to concern themselves with the quality of accounting earnings and inhibit earnings management practices that could increase their cost of debt. [ABSTRACT FROM AUTHOR]

Possible reform of the global sovereign debt management framework is continuously discussed among the members of the policymaking community. After the evaporating Washington Consensus, several reform proposals were made. Some of them were realised, and others remained on paper. The area received new impulses after the Financial Crisis in 2008, mainly due to the European sovereign debt problems. Many of these suggestions were later forgotten. The worldwide fiscal stimuli caused by the COVID-19 pandemic in 2020 and the rapidly deteriorating sovereign debt situation induced another plethora of policy proposals. Some are novelties, but most are revised versions of the old ideas. The study aims to synthesise the old and newer suggestions, identifying current policy trends. The conclusion: the contractual approach still dominates the field, although there are also some feasible statutory-based ideas. [ABSTRACT FROM AUTHOR]

Sovereign debt management (SDM) requires decisions about the composition and structure of central government debt. Nowadays the process is delegated to professional debt management offices (DMOs), which use complex financial instruments and resort to capital markets. Parliaments in some countries have expressed concern over losing control of SDM. This article devises two indices to measure parliamentary control over SDM and DMOs' implementation flexibility. It applies both indices to original data from 17 OECD countries. The article finds that parliaments' legal authority over SDM and rights to information pertaining to it relate to their general power as well as economic and SDM financialisation. There is no trade-off between parliamentary strength and DMOs' flexibility in operational decisions. These findings are of interest for research on parliamentary power, financialisation and delegation. To draw causal inferences from these associations more research is needed on the timing, politics and consequences of institutional change towards professional DMOs. [ABSTRACT FROM AUTHOR]

This study investigated the effect of government debt on Nigeria's economic growth using annual data from 1980 to 2018 and the Autoregressive Distributed Lag technique. The empirical results showed that external debt constituted an impediment to long-term growth while its short-term effect was growth-enhancing. Domestic debt had a significant positive impact on long-term growth while its short-term effect was negative. In the long term and short term, debt service payments led to growth retardation confirming debt overhang effect. The findings suggested that the government should direct the borrowed funds to the diversification of the productive base of the economy. This will improve long-term economic growth, expand the revenue base and strengthen the capacity to repay outstanding debts when due. Fiscal improvements that encourage domestic resource mobilization, efficient debt management strategies and reliance on domestic debt rather than external debt for increased deficit financing to engender greater growth are the main contribution of the study. [ABSTRACT FROM AUTHOR]

This paper presents a method for integrating debt management into fiscal policy using principles derived from the work of Kalecki. It proposes dividing the government budget into a functional budget containing taxes and expenditure that may affect expenditures in the non-financial economy, and a financial budget containing taxes on wealth and higher incomes that do not affect expenditures in the real economy but do affect the liquidity of wealth portfolios. This gives the government two more or less independent instruments to manage economic growth and government debt. The respective balances between the functional and financial budgets then affect the fiscal multiplier showing how cases of expansionary fiscal contraction, contractionary fiscal expansion, expansionary financial instability, and deflationary financial instability may arise. The analysis applies to domestically financed debt. [ABSTRACT FROM AUTHOR]

Private financial markets are central to the implementation of monetary governance. This necessary integration of public and private finance means the way states govern must evolve with developments in financial markets. This article examines how the rise of liability management underpinned a shift to market-based banking and transformed the operation of monetary policy in Britain. It assesses the period of reform between 1967 and 1981 and what this meant for monetary governance. Political economy literature depicts this period as a shift to depoliticised, deregulated governance with public authority giving way to market power. This paper challenges this perspective on the grounds that it misconstrues the problem policymakers faced. The shift from Keynesian to neoliberal monetary governance came in response to the change in banking practice with the rise of liability management and a parallel money market. This underpinned an explosion of credit creation that the old system of monetary policy, organised around the Base Rate and 'primary' discount market could not fix. As a result, the monetary authorities had to render this new financial environment governable. The period should therefore be reassessed in terms of the capacities the state attempted to construct to conduct monetary governance. [ABSTRACT FROM AUTHOR]

This study is the first to assess whether smartphone apps can be utilised to improve financially capable behaviours. In this study four smartphone apps, packaged together under the title 'Money Matters', were provided to working-age members (16–65 years) of the largest credit union in Northern Ireland (Derry Credit Union). The smartphone apps consisted of a loan interest comparison app, an expenditure comparison app, a cash calendar app, and a debt management app. The assessment methodology used was a Randomised Control Trial (RCT) with the U.K. Financial Capability Outcome Frameworks used to set the context for the assessment. For those receiving the apps (the treatment group) statistically significant improvements were found in a number of measures designed to gauge 'financial knowledge, understanding and basic skills' and 'attitudes and motivations'. These improvements translated into better financially capable behaviours; those receiving the apps were more likely to keep track of their income and expenditure and proved to be more resilient when faced with a financial shock. [ABSTRACT FROM AUTHOR]

This study seeks to examine the relationship between short-term debt maturity and accruals-based earnings management using a sample of listed firms in Vietnam from 2010–2017. The extant literature remains under-explored on the impact of short-term debt on accruals-based earnings management at low and high levels of short-term debt. We further dissect the impact of the interaction between the growth opportunities and short debt maturity on accruals-based earnings management. Our findings provide evidence suggesting that short-term debt maturity is likely to exert a desirable impact in lowering earnings management at low levels of short-term debt, while at high levels it tends to increase earnings manipulation, demonstrating a U-shaped relationship. Furthermore, we show that growth opportunities moderate the impact of short debt maturity on earnings management. Specifically, the U-shaped pattern between short-term debt and earnings management is pronounced for firms with low growth opportunities, while for high-growth counterparts that pattern weakens. [ABSTRACT FROM AUTHOR]

The China–Pakistan Economic Corridor (CPEC) is a US$62 billion project designed to resolve Pakistan's energy deficit, improve connectivity, and establish economic development zones and supporting social infrastructure that lay the foundations for subsequent economic growth, grapple with endemic instability and exploit Pakistan's strategic position. Challenges posed by the geographical environment, terror groups, political instability and the management of debt, along with geopolitical issues relating especially to relationships with India, are examined and assessed. [ABSTRACT FROM AUTHOR]

Previous academic literature has criticised bond buyback as a '"boondoggle" benefiting a country's creditors'—meaning that buybacks are a wasteful use of public money. This paper challenges the narrow financial–economic perspective behind that statement by adopting a broader socio-political framework that includes the potential benefits of buyback for citizens, not just financial market costs. In particular, buyback does not necessarily require a budget surplus via higher local taxes and/or increased austerity measures. Although debt brake and balanced budget rules strengthened limits established in the EU's Stability and Growth Pact (SGP), transitional periods allowed local governments to deviate from them. Thereafter, local government directors of finance will be faced with the growing presence of financial derivatives in public accounts and the development of sub-sovereign fiscal decentralization, both of which are affecting debt management. This paper shows how EU fiscal rules may legitimize bond buyback in the current fiscal austerity context. Both financial stability and compliance with the SGP could be addressed by adopting policies aligned towards using innovative financial accounting engineering solutions. [ABSTRACT FROM AUTHOR]

In the last decade, a bourgeoning body of literature has explored the influence of financial actors, techniques and motives in the urban development of North American and European cities. Less has been said about the influence of finance on the temporalities of urban production and urban life. Yet finance is, at its most basic, the management of debt; and debt is, simply put, the deferral of payment; thus, by its very nature, financialization introduces new temporal dynamics into whatever object of investment it engages with. This paper examines these temporal dynamics in the financialized production of a large-scale urban infrastructure project, the Thames Tideway Tunnel (TTT), a 25-km 'super-sewer' beneath the River Thames where it runs through the center of London. From analyzing how financial actors, motives, and instruments influence the planning and implementation of this massive sewer expansion, it traces the ways in which the temporal characteristics of finance have repercussions in the urban space that privilege financial interests. This analysis contributes both conceptual and empirical insights. Firstly, it provides a theoretical conceptualization of the ways in which the temporalities of financialization shape the material production of the city. Secondly and more empirically, our case analysis allows us to schematize the different ways in which the financialization of the TTT project shapes the temporalities of its production, with wide-ranging political, economic and environmental implications. In summary, the paper closes a crucial gap in understanding how different temporalities of finance intersect in the making of contemporary cities. [ABSTRACT FROM AUTHOR]

Tackling foreign debt that arises as a result of limited and ineffective use of resources is an item that remains on the agenda particularly for developing countries. In this study, we examine the foreign debt debates to date in terms of economic growth and using the time series for the period 2003Q1 to 2017Q1. We used unit root tests to determine the maximum integration degree of series, and we conducted causality analysis. We found a causality relationship between net foreign debt stock and economic growth in causality analyses performed for Turkey. The empirical results of this study indicate that there is a causality relationship, including both positive and negative aspects, between net foreign debt stock and economic growth. The results of our testing showed a significant causal relationship between the variables. [ABSTRACT FROM AUTHOR]

Recent studies have found that the European Parliament (EP) had limited substantive influence on the European Union's response to the European debt crisis. It has been argued that Parliament compensated this loss by expanding its oversight powers over executive bodies in the implementation of crisis legislation. This article systematically assesses the conditions under which the EP has been successful in increasing its account-holding powers, using new data on the accountability provisions included in economic and financial legislation put forward between 2009 and 2014. It is found that Parliament has indeed been more likely to gain oversight powers in crisis legislation. Levels of accountability are also higher in package deals and more salient legislation. The findings here provide a more nuanced picture of Parliament's inter-institutional gains and losses in recent years and give more insight into the EP's account-holding role. [ABSTRACT FROM AUTHOR]

The extant literature has offered two competitive implications of revenue diversification: revenue stabilisation and fiscal illusion. Stabilisation helps governments have less revenue volatility, while fiscal illusion expands tax burdens through the increase in expenditure. The competitive views on revenue diversification leave a niche to explore the association between revenue diversification and debt levels in local governments. We estimate the static and dynamic effects of revenue diversification on both short-term and long-term debt levels in 150 fiscally standardised cities. Our findings show that local governments with greater revenue diversification are more likely to reduce short-term debts while expanding long-term debts. The findings imply that a stabilised revenue structure helps local governments better manage operational budgets but also invest in capital projects with greater debt capacity. [ABSTRACT FROM AUTHOR]

We examine whether the debt maturity structure of privately held firms is associated with the quality of their earnings numbers. We argue that earnings numbers that are better able to predict future cash flows lower information asymmetry between privately held firms and their creditors, improving privately held firms’ access to long-term debt. Furthermore, we examine whether the relationship between privately held firms’ earnings quality and their debt maturity differs between small and medium-sized enterprises (SMEs) and larger privately held firms. Using detailed financial statement information from a sample of privately held Belgian firms, we find that earnings quality is positively associated with the likelihood of having long-term debt and with the proportion of long-term debt in total debt. Further, we report evidence that these associations are more pronounced for SMEs than for larger privately held firms, which is consistent with smaller firms entailing more fundamental risk for creditors. [ABSTRACT FROM AUTHOR]

This paper looks at the development of the two types of credit card systems in the UK, the bank credit cards and the retailer credit cards. The article seeks to address the issue of who will hold the balance of power at the introduction of an EFTPOS, or direct-debit, system into the UK. The situation in 1988 appears to be that retailers are well up the "learning curve" as regards the management and marketing of credit and so are increasingly proving to be a threat to the banks not only in the provision of credit but also in offering a wide range of financial services. [ABSTRACT FROM AUTHOR]

The study investigates the impact of institutional quality on the external debt-growth nexus in SSA. Data from 36 SSA economies over the 1996-2013 periods were used. The results from the IVSystem GMM imply that institutional quality has robust effects on the external debt-growth nexus. Thus, the impact of external debt on growth is through host nation's institutional quality. However, the mediating effect of institutional quality on this nexus is up to a point. When a country is on the wrong side of the debt-laffer curve, external debt becomes irrelevant; and institutional quality can no longer help. [ABSTRACT FROM AUTHOR]

The article reflects on the impact of student debt on the crisis in higher education in the U.S. Topics discussed include an overview of the education in the country, the financial resources of the students, the costs and expenses of their education, and the availability of loans and subsidies for the students.

This paper investigates the relationship between the funded ratio of US public pension plans and several fiscal institutions adopted by state governments. The author analysed a large data set from 1997 to 2012, and found that states with stricter balanced budget requirements and debt limits had a lower pension funded ratio, whereas states with tax and spending limits in place had a higher funded ratio. The findings contribute to the current debate on public sector pension reforms in the US and internationally. [ABSTRACT FROM AUTHOR]

Financial markets play an indispensable role in the management of sovereign debt, that is, the mechanics of how and from whom governments borrow. This paper suggests a novel, two-dimensional concept to measure the financialisation of sovereign debt management (SDM): (1) the reliance on financial markets as a governance mechanism and (2) the adoption of a sense-making framework grounded in financial economics. We split this concept into nine indicators and apply it to data from 23 OECD countries between 1980 and 2010. Our analysis illustrates the predominant commonalities across countries, but at the same time, country-specific differences. We interpret them as two sides of the same coin in the light of an overarching trend of increasing alignment to financial markets. This article is not only one of the first cross-national as well as longitudinal studies of the dynamics in SDM; it also reveals that the relationship between finance and governments in the SDM is by no means one-sided. [ABSTRACT FROM AUTHOR]

Past research has documented a substitution effect between real earnings management (RM) and accrual-based earnings management (AM), depending on relative costs. This study contributes to this research by examining whether levels of (and changes in) financial leverage have an impact on this empirically documented trade-off. We hypothesise that in the presence of high leverage, firms that engage in earnings manipulation tactics will exhibit a preference for RM due to a lower possibility – and subsequent costs – of getting caught. We show that leverage levels and increases positively and significantly affect upward RM, with no significant effect on income-increasing AM, while our findings point towards acomplementarityeffect between unexpected levels of RM and AM for firms with very high leverage levels and changes. This is interpreted as an indication that high leverage could attract heavy outsider scrutiny, making it necessary for firms to use both forms of earnings management in order to achieve earnings targets. Furthermore, we document that equity investors exhibit a significantly stronger penalising reaction to AM vs. RM, indicating that leverage-induced RM is not as easily detectable by market participants as debt-induced AM, despite the fact that the former could imply deviation from optimal business practices. [ABSTRACT FROM PUBLISHER]

This article examines the association between underwriting syndicates and the cost of debt based on a sample of Chinese corporate bonds during 2007–2013. We find strong evidence that there is a negative relationship between forming underwriting syndicates and the cost of debt. The cost of bonds is more likely to decrease when the syndicate has more members—specifically, more joint managers. Additionally, by measuring the information asymmetry using several methods, we observe that this negative relationship is more pronounced when the information asymmetry between issuers and bond investors is more serious. The above results are robust after controlling for the potential endogeneity by constructing instrumental variables based on the unique setting of China’s corporate bond market. [ABSTRACT FROM PUBLISHER]

Existing literature studies debt shifting and transfer pricing separately. In practice, however, the choice of debt-to-asset ratios in affiliates and the interest rate on internal debt are interrelated management decisions that are also mutually affected by government regulation. Therefore, this paper models these strategies as simultaneous decisions made by the management. We find that the tax sensitivity of the corporate tax base depends on whether debt shifting and transfer pricing are cost complements or substitutes. A second result is that stricter regulation of debt shifting and transfer pricing may have the effect of fostering such activities. [ABSTRACT FROM AUTHOR]

This article investigates the transmission from equity markets to commodity markets during two major financial crises, namely the Subprime Mortgage and the Sovereign Debt Crises. We perform an analysis on sub-stages from 3 January 2003 to 31 October 2013 to capture the price behaviour of both equity and commodity markets. Two financial crises indicators, VIX and CDS, are used to represent fear of a crisis. We find that correlations between commodity and equity markets are time-varying and highly volatile during a financial crisis. While sharing some common features, commodities cannot be considered a homogeneous asset class. Segmentation characteristics of commodity markets disappear in times of financial crises, reducing their substitutability as an investment portfolio for asset diversification purposes. Through our test for Granger causality, we find the existence of transmission during a financial crisis. Volatility spillover effect also plays a major role as transmission mechanisms. After the collapse of Lehman Brothers, commodities decoupled from the VIX rather soon, and there is an increase in correlation with the CDS. In addition, we find the decoupling effect of most commodities show insignificant correlations with the Dow Jones, VIX and CDS after the Greek debt restructuring. [ABSTRACT FROM AUTHOR]

In theirwork, Vegh and Vuletin have shown that statutory tax rates are acyclical in developed economies and procyclical in developing ones. This article extends their analysis by checking the interaction of statutory tax rates with countries' external public debt. In general, we found that the value added tax rates are changed procyclically in both developed and developing countries (i.e. taxes are raised in bad times and reduced in good times). However,when the external debt is high, in the developing countries the procyclicality increases, while the opposite result holds for developed economies. This pattern occurs mainly in times of recession, when the need for loans is the highest. Although we found that there was a reduction in procyclicality after the 2000s, these findings pose a challenge to policy-makers, who should think of ways of dealing with lack of foreign funds in difficult times. [ABSTRACT FROM AUTHOR]

This article demonstrates the diverse dynamic possibilities arising out of a simple macroeconomic model of debt-financed investment-led growth in the presence of interest rate rules. We show possibilities of convergence to steady state, and growth cycles around it as well as various complex dynamics. We investigate whether, given this framework, the financial sector can provide endogenous bounds to an otherwise unstable system. The effectiveness of monetary policy in the form of an interest rate rule targeting capacity utilization is examined under this context. [ABSTRACT FROM PUBLISHER]

Using a panel of 13 advanced economies for the period 1980–2012, we find that periods of impaired financial intermediation mainly accrue to maturity mismatches in sovereign debt. Thus, a higher (lower) share of short-term (medium and long-term) debt leads to an increase in the financial stress index. From a policy perspective, our work suggests that debt management policies translated into longer average maturities of sovereign debt not only reduce the expected debt servicing cost, but also mitigate strains in the financial sector. [ABSTRACT FROM PUBLISHER]

An econometric model based on a natural experiment and the difference-in-differences method is introduced to empirically investigate the impact of split share structure reform on capital structures. A total of 1026 listed companies in Chinese A-share during 2001–2011 are used as the sample for the research and interest-bearing debt ratios (BDRs) are taken as a representative indicator for capital structures. The theoretical and empirical analysis indicates that both market expansion effect and corporate governance effect caused by the split share structure reform are associated with an increase in BDR. As far as the timeliness is concerned, the effects of split share structure reform on capital structures will last 3–4 years. [ABSTRACT FROM PUBLISHER]

While a careful and accurate debt sustainability assessment (DSA) is crucial for an efficient macroeconomic management, the most widely used framework introduced by the International Monetary Fund (IMF) suffers from several drawbacks that render its results overoptimistic and misleading. In this article, we correct the methodology by demonstrating how policy makers can develop country-specific “intermediate” forecasts of the determinants of debt dynamics, in addition to coherent “optimistic” and “pessimistic” scenarios. Our application to the case of Egypt illustrates that the debt-to-GDP ratio could increase to more than 100 percent by 2015, in contrast with the 61 percent projected by the IMF in 2010. [ABSTRACT FROM AUTHOR]