Resolving Debt Overhang: Political Constraints in the Aftermath of Financial Crises

• 成果类型: Article
• 署名作者: Mian, Atif; Sufi, Amir; Trebbi, Francesco
• 署名单位: Princeton University; National Bureau of Economic Research; University of Chicago; University of British Columbia
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.6.2.1
• 发表日期: 2014
• 页码: 1-28
• 关键词: economy; credit; deflation

摘要

Countries become more politically polarized and fractionalized following financial crises, reducing the likelihood of major financial reforms precisely when they might have especially large benefits. The evidence from a large sample of countries provides strong support for the hypotheses that following a financial crisis, voters become more ideologically extreme and ruling coalitions become weaker, independently of whether they were initially in power. The evidence that increased polarization and weaker governments reduce the chances of financial reform and that financial crises lead to legislative gridlock and anemic reform is less clear-cut. The US debt overhang resolution is discussed as an illustration.