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International Finance Discussion Papers
The International Finance Discussion Papers logo links to the International Finance Discussion Papers home page External Debt and Developing Country Growth
Steven B. Kamin, Robert B. Kahn and Ross Levine
1989-352  (May 1989)

Abstract:  This paper examines the question of how the path of real GDP in four important Latin American countries, Argentina, Brazil, Chile and Mexico, might have differed if the sharp run-up in borrowing during the late 1970s and early 1980s had not occurred. Specifically, we ask whether these countries are better off or worse off for having borrowed heavily prior to the debt crisis, and we attempt to gauge the extent to which they would have received greater benefits if policies that improve economic efficiency had been followed. A simple macroeconomic mode is developed, and the simulation results are compared to the historical outcomes.

Full paper(435 KB PDF)

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