International Capital Flows and the World Debt Problem

  • Rudiger Dornbusch
  • Stanley Fischer


In 1983 the debt problems of developing countries, especially Latin America’s problems, appeared on the way to a solution. Despite the strains following first the Polish and then major Latin American borrower difficulties, the international financial system did not collapse. Moratoria quickly gave way to IMF adjustment programmes and debt rescheduling that provided the debtors with a way of avoiding default and meeting debt service liabilities by borrowing fresh money from the banking system.


Interest Rate Real Exchange Rate Real Interest Rate Capital Flow Nominal Interest Rate 
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Copyright information

© Assaf Razin and Efraim Sadka 1987

Authors and Affiliations

  • Rudiger Dornbusch
  • Stanley Fischer

There are no affiliations available

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