Market Discipline

June 1, 1992

Preview Citation

Format: Chicago

Timothy D. Lane Market Discipline, (USA: International Monetary Fund, 1992) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

Under what circumstances can market forces prevent unsustainable borrowing? Effective market discipline requires that capital markets be open, that; information on the borrower’s existing liabilities be readily available, that no bailout be anticipated, and that the borrower respond to market signals. This paper explores the implications of these conditions, and reviews some relevant empirical evidence.

Subject: Banking, Debt default, Debt financing, Deposit insurance, External debt, Financial crises, Fiscal policy, Public debt

Keywords: Central and Eastern Europe, Debt default, Debt financing, Deposit insurance, Exchange rate, Financial market liberalization, Market access, Market discipline, Market forces, Market lender, Market participant, Market perception, Markets discipline borrower, WP

Publication Details

Pages:

50
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1992/042
Stock No:

WPIEA0421992
ISBN:

9781451846157
ISSN:

1018-5941

Notes

Also published in Staff Papers, Vol. 40, No. 1, March 1993.

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