Tab. 1
Determinants of the probability of public sector default
| VARIABLES | (1) | (2) | (3) | (4) | (5) |
|---|---|---|---|---|---|
| debt_ppg | 0.00473*** | 0.00309*** | 0.00175** | ||
| (0.00130) | (0.000879) | (0.000855) | |||
| debt_png | -0.0469** | ||||
| (0.0199) | |||||
| debt_png _1 | 0.992*** | ||||
| (0.239) | |||||
| debt_png _2 | -0.207*** | ||||
| (0.0576) | |||||
| bonds_ppg | 0.0348* | 0.0295 | |||
| (0.0205) | (0.0188) | ||||
| banks_ppg | 0.0686*** | 0.0811*** | |||
| (0.0125) | (0.0111) | ||||
| bonds_png | -0.852*** | -0.642** | |||
| (0.322) | (0.319) | ||||
| bonds_png_1 | -0.000458 | ||||
| (0.000333) | |||||
| bonds_png_2 | -1.121** | ||||
| (0.497) | |||||
| banks_png | -0.0316 | 0.000372 | 0.0177 | ||
| (0.0208) | (0.0129) | (0.0111) | |||
| growth | -0.0340* | -0.0225 | -0.0335** | -0.0510*** | -0.0448*** |
| (0.0175) | (0.0178) | (0.0148) | (0.0139) | (0.0120) | |
| Infla | -0.00105*** | -0.00171*** | -0.00165*** | -0.000267 | -0.000180 |
| (0.000392) | (0.000458) | (0.000387) | (0.000262) | (0.000219) | |
| Trade | -0.00550 | 0.00157 | -0.00816** | -0.00224 | -0.00472 |
| (0.00584) | (0.00596) | (0.00366) | (0.00357) | (0.00437) | |
| shdebt_res | -4.80e-05 | -6.43e-05 | -7.31e-05 | -5.61e-06 | -5.62e-06 |
| (5.31e-05) | (5.75e-05) | (5.08e-05) | (9.16e-06) | (7.75e-06) | |
| Ers | -0.828** | -0.707* | -0.716** | -0.537* | -0.738** |
| (0.382) | (0.395) | (0.306) | (0.313) | (0.331) | |
| Constant | -2.706*** | -2.399*** | -3.227*** | ||
| (0.294) | (0.383) | (0.520) | |||
| Observations | 1,987 | 1,987 | 3,873 | 3,873 | 3,873 |
| Country fixed effects | Yes | Yes | No | No | No |
| Best powers | 0,5; 1 | -2; 0.5 |
[i] Notes: Standard errors in parentheses; *** p < 0.01, ** p < 0.05.
Fig. 1
The fractional polynomial models fits, against the private, non-guaranteed debt, in % of GDP (debt_png), with 95% confidence bands (adjusted for covariates)
Tab.A1
List of variables used in regressions
| Variables | Definition | Source |
|---|---|---|
| debt_ppg | External public and publicly guaranteed debt, in percent of GDP | Joint External Debt Hub |
| bonds_ppg | and public and publicly guaranteed bonds in percent of GDP | Joint External Debt Hub |
| banks_ppg debt_png | the amounts of public and publicly guaranteed bank loans in percent of GDP private, non-guaranteed external debt, in percent of GDP | Joint External Debt Hub Joint External Debt Hub |
| bonds_png | private non-guaranteed bonds | Joint External Debt Hub |
| banks_png | private, non-guaranteed bank loans | Joint External Debt Hub |
| growth | GDP growth rate | World Bank, World Development Indicators database |
| infla | inflation | World Bank, World Development Indicators database |
| trade | trade openness | World Bank, World Development Indicators database |
| shdebt_res | the ratio of short term total external debt to reserves | World Bank, World Development Indicators database |
| ers | exchange rate stability index | Aizenman et al. (2008) |
[i] Full list of countries used in regression analysis:
Afghanistan, Albania, Algeria, Angola, Argentina, Armenia, Azerbaijan, Bangladesh, Belarus, Belize, Benin, Bhutan, Bolivia, Bosnia and Herzegovina, Botswana, Brazil, Bulgaria, Burkina Faso, Burundi, Cabo Verde, Cambodia, Cameroon, Central African Republic, Chad, China, Colombia, Comoros, Costa Rica, Cote d’Ivoire, Djibouti, Dominica, Dominican Republic, Ecuador, Egypt, El Salvador, Eritrea, Ethiopia, Fiji, FYR Macedonia, Gabon, Georgia, Ghana, Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, Hungary, India, Indonesia, Islamic Republic of Iran, Jamaica, Jordan, Kazakhstan, Kenya, Kyrgyz Republic, Lao P.D.R., Lebanon, Lesotho, Liberia, Madagascar, Malawi, Malaysia, Maldives, Mali, Mauritania, Mauritius, Mexico, Moldova, Mongolia, Montenegro, Morocco, Mozambique, Myanmar, Nepal, Nicaragua, Niger, Nigeria, Pakistan, Panama, Papua New Guinea, Paraguay, Peru, Philippines, Republic of Congo, Rwanda, Samoa, Senegal, Serbia, Seychelles, Sierra Leone, Solomon Islands, South Africa, Sri Lanka, St. Lucia, St. Vincent and the Grenadines, Sudan, Swaziland, Syria, Tajikistan, Tanzania, Thailand, The Gambia, Togo, Tonga, Tunisia, Turkey, Turkmenistan, Uganda, Ukraine, Uzbekistan, Vanuatu, Venezuela, Vietnam, Yemen, Zambia, Zimbabwe.