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on Open Economy Macroeconomics |
| By: | Swapan-Kumar Pradhan; Eswar S. Prasad; Előd Takáts; Judit Temesvary |
| Abstract: | We investigate how the U.S. dollar’s prominence in the denomination of international debt securities has evolved in recent decades, using a comprehensive global dataset with far more extensive coverage than datasets used in prior literature. We find no monotonic dollarization or de-dollarization trend; instead, the dollar’s share exhibits a wavelike pattern. We document three dollarization waves since the 1960s. The last wave, following the global financial crisis, lifted the dollar’s share nearly back to its level at the euro’s launch in 2000. We show that closer alignment of a country’s domestic currency to a reserve currency (e.g., the U.S. dollar) correlates with higher shares of issuance in that currency. Our findings are robust to composition and currency valuation effects as well as alternative data definitions. |
| JEL: | F3 F41 G15 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34942 |
| By: | Juan Pablo Di Iorio (UDESA); Javier García-Cicco (UDESA) |
| Abstract: | A salient feature of many emerging and developing economies is that a substantial fraction of government debt is denominated in foreign currency. We study the implications of the Fiscal Theory of the Price Level (FTPL) in a standard New Keynesian small and open economy model, with an explicit role for the currency denomination of public debt. We show that, while the classical FTPL characterization of equilibrium existence and uniqueness extends largely independently of debt composition, the propagation of shocks does not. The currency denomination of public liabilities alters the effects of monetary and fiscal policy, including the possibility that a monetary tightening leads to a depreciation under active fiscal regimes. More broadly, the interaction between the fiscal-monetary policy mix and the share of foreign-currency debt also plays a central role in shaping the response to external shocks. |
| Keywords: | Fiscal theory of the price level; inflation; exchange rate; fiscal and monetary policy interactions; currency composition of government debt. |
| JEL: | E31 E52 E63 F41 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:aoz:wpaper:390 |
| By: | Zwart, Sanne |
| Abstract: | Compared with the relatively straightforward definition of a default event, assessing sovereign debt sustainability remains a grey area. The interaction between fiscal choices, lenders' expectations and economic uncertainty creates a setting in which-particularly when a default looms-anticipation and coordination can matter as much as analysing economic fundamentals. To explore these rich debt dynamics, we develop a parsimonious model in which a government repeatedly makes fiscal and default decisions, while lenders demand bond yields that compensate for default risk. The model sheds light on when and why governments demonstrate fiscal prudence or even build fiscal buffers. It also illustrates how lenders' beliefs, by selecting the equilibrium outcome, can constrain a government's ability to issue debt-highlighting the influence of actors such as credit rating agencies that help form these beliefs. Notably, besides debt levels and lenders' expectations, the maturity profile of debt emerges endogenously as a key dimension of debt sustainability. Finally, we examine the role of supranational lenders in the international financial architecture. We find that well-designed financial support, whether to avoid crises or remedy the underprovision of commercial lending, constitutes a distinct class of debt, while markets still impose fiscal discipline on the sovereign. |
| Keywords: | Sovereign default, Self-fulfilling crises, Safe assets, Supranational lending |
| JEL: | F33 F34 G12 H63 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:eibwps:338084 |
| By: | Kota Yamada (Tokoha University); Masaya Yasuoka (Kwansei Gakuin University) |
| Abstract: | This paper analyzes the effects of immigration on host countries' labor markets and capital accumulation using a dynamic general equilibrium model with two host countries and one sending country. Higher productivity or greater capital accumulation in a country raises wages and attracts more immigrants, whereas an increase in the labor force lowers wages and suppresses inflows. These results have been demonstrated in the existing literature. When we consider capital mobility between two countries that both accept immigrants, how is the number of immigrants admitted by each country determined? If we consider not only labor mobility but also capital mobility, the inflow of immigrants raises the marginal product of capital, thereby promoting capital inflows. In turn, capital inflows increase the marginal product of labor, which further encourages additional immigration. The findings provide useful policy implications for OECD countries facing declining fertility, population aging, and concerns over future labor shortages. |
| Keywords: | Capital Mobility, Immigration, Multi Immigration-Receiving Countries |
| JEL: | J15 E24 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:kgu:wpaper:307 |
| By: | Ibrahim Ag Elmoctar (UL - Université de Labé); Moussa Diakite (UL - Université de Labé) |
| Abstract: | Déclaration de divulgation :Les auteurs n'ont pas connaissance de quelconque financement qui pourrait affecter l'objectivité de cette étude. Ils assument l'entière responsabilité de tout éventuel plagiat, de l'usage de l'intelligence artificielle dans la rédaction, ainsi que des résultats présentés dans cet article. Conflit d'intérêts :Les auteurs ne signalent aucun conflit d'intérêts. |
| Keywords: | Economic growth, Instabilité monétaire Inflation Taux de change Croissance économique Guinée JEL Classification : E31, E52, F31, O55 Type du papier : Recherche empirique Monetary instability Inflation Exchange rate Economic growth Guinea JEL Classification : E31, Guinea JEL Classification : E31, O55 Paper type : Empirical Research, Exchange rate, O55 Type du papier : Recherche empirique Monetary instability, Guinée JEL Classification : E31, Croissance économique, Taux de change, Inflation, Instabilité monétaire |
| Date: | 2026–01–15 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05463917 |