OFIN 3255A - Managing Sovereign Debt

This module offers a comprehensive introduction to sovereign debt and its management, combining the analytical tools from economics and finance with the perspectives and insights from history, law, and political science. We discuss sovereign debt globally and over multiple centuries, with a particular focus on recent/ongoing debt distress situations and restructurings. The first part of the course introduces the key notions and technical concepts progressively, with weekly readings complementing the lecture notes. The second part is dedicated to case studies, with interventions from practitioners. Although the material is self- contained, some background in finance and/or economics is welcome.

Weekly lectures take place on Tuesdays, 14:45-16:45, in Amphi Erignac at 13 rue de l'Université.

Course outline (subject to modifications)

L1 – Introduction: public finance & public debt

L2 – Sovereign debt markets: instruments & institutions

L3 – Sovereign debt markets: pricing sovereign credit risk

L4 – Official lenders: bilateral creditors & multilateral institutions

L5 – Public debt dynamics and debt sustainability

L6 – Sovereign defaults & restructurings: taxonomy, incidence, and process

L7 – Dealing with private creditors in sovereign debt restructurings: contractual & legal

aspects

L8 – The economics of sovereign default: circumstances and consequences

L9 – Case study 1

L10 – Case study 2

L11 – Case study 3

L12 – Final exam

None

12 lectures x 2h = (24h)

4 Credits

The course grade is based on a flash test in Week 6 (25%), a take-home assignment due in Week 9 after the break (25%), a final exam in Week 12 (40%), and class participation (10%).