Sachs, Jeffrey. <br/><br/>
LDC Borrowing with Default Risk / 
Jeffrey Sachs, Daniel Cohen. 
 - Cambridge, Mass.  National Bureau of Economic Research  1982. 
 - 1 online resource:  illustrations (black and white); 
 - NBER working paper series  no. w0925 .
 - Working Paper Series (National Bureau of Economic Research)  no. w0925. .
<br/><br/> July 1982. 
<br/><br/> This paper presents a theoretical model to describe the effects of default risk on international lending to LDC sovereign borrowers. The threat of defaults in international lending is shown to give rise to many characteristics of the syndicated loan market: (1) quantity rationing of loans; (2) LDC policies designed to enhance creditworthiness; (3) prevalence of short maturities on international loans; and (4) a prevalence of bank lending relative to bond-market lending 
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