A Review of Michael Tomz's Reputation and International Cooperation: Sovereign Debt across Three Centuries
Gersovitz, Mark. 2009. "A Review of Michael Tomz's Reputation and International Cooperation: Sovereign Debt across Three Centuries."
Journal of Economic Literature,
Repudiation and expropriation pose obstacles to the international mobility of capital
and thereby to efficient international allocation of resources. Tomz discusses the determinants
of lending in the face of the threat of repudiation. Using history, he argues
that debtor countries have sought a reputation for compliance with loan agreements
to access future loans and that military or trade sanctions have been unimportant in
sustaining lending. He discusses when and why banks have been more active as lenders
relative to bondholders. This article situates Tomz's concerns in the broad themes
of thought on obstacles to capital mobility and evaluates his arguments.
Article Full-Text Access
Gersovitz, Mark (Johns Hopkins U)
F34: International Lending and Debt Problems
N20: Economic History: Financial Markets and Institutions: General, International, or Comparative