ABSTRACT
The crises of the 1820s, 1870s, and 1930s all ended in long-term moratoria, with creditors and debtors sharing the negative consequences of the downturn. This chapter sketches the previous major debt crises in Latin America and outlines the differences between the response to them and to the current crisis. It suggests several hypotheses that might account for the differences. The chapter examines the contributions of factors on the creditor side in explaining responses to the 1980s crisis. It focuses on debtor-based explanations for the 1980s. The chapter considers changes in international power relations and their implications for the debt crisis. It discusses the ability of the United States to continue to play a dominant role may be undermined as its economic power wanes. The chapter describes how the shifting balance of international economic power among advanced industrial countries will affect policies on Third World debt.
