What is it about?
Contract enforcement plays an important role in international lending. We examine the hypotheses that better contract enforcement increases the level and lengthens the maturity of international debt. The empirical evidence supports these hypotheses.
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Why is it important?
The importance of this paper lies in linking contract enforcement to exposure to financial crises through reduced international debt maturity. This is a major contribution of the paper.
Perspectives
The paper sheds light on the importance of property right protection for international lending. Commitment to PRP, as a legal institution, contributes to financing economic development and growth, and reduces vulnerability to financial crises. The paper is motivated by the regional East Asian financial crises of 1998.
Professor Wasseem Mina
United Arab Emirates University
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This page is a summary of: Does contract enforcement matter for international lending?, Applied Economics Letters, May 2006, Taylor & Francis,
DOI: 10.1080/13504850500394350.
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