We examine how IMF programs and collective action clauses affect the terms of market access. We find different effects on different types of borrowers. Fund programs appear to create additional commitment for bond borrowers with "intermediate" credit, who consequently are able to borrow at lower cost. Moreover, Fund programs with limited structural conditions have the most favorable effects on investor confidence. Easier restructuring through collective action clauses raises the costs for borrowers with low credit ratings but lowers them for those with high ratings. Thus, for the relatively high quality creditors, own commitment and voluntary restructuring work best.
|Number of pages
|IMF Staff Papers
|Published - 2000
All Science Journal Classification (ASJC) codes
- Economics and Econometrics