Abstract
This chapter provides an introduction. It argues that the traditional term for the instrument (“GDP-linked bond”) is wrong, inasmuch as a bond has by definition a fixed return. It defines a GDP-linked security as any instrument that pays a rate of return that depends upon GDP or its growth rate. The remainder of the chapter is devoted to outlining the chapters that follow.
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It is true that the return on an equity can also be influenced by policies of management like payout ratios and takeover policy, but if they deviate far from the stream of dividends permitted by profits the management is liable to find itself out of a job.
Reference
Borensztein, Eduardo, and Paolo Mauro. 2004. The Case for GDP-Indexed Bonds. Economic Policy 19: 165–216.
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Williamson, J. (2017). Introduction. In: Growth-Linked Securities . Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-68333-1_1
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DOI: https://doi.org/10.1007/978-3-319-68333-1_1
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Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-68332-4
Online ISBN: 978-3-319-68333-1
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