ABSTRACT
In this book, we have adopted the premise that widespread defaults on international debt incurred by sovereign states would have extremely serious consequences on the international economy. However, as we pointed out, there are institutional features in present-day international lending and borrowing which make defaults more costly than they used to be. The greater degree of interdependence among countries, plus the fact that developing countries tend to be more reliant on international trade than developed ones, reinforces this point.
