Sovereign Risk: A Reappraisal

11 Pages Posted: 6 Jan 2014

See all articles by Didier Maillard

Didier Maillard

Conservatoire National des Arts et Métiers (CNAM); Amundi Asset Management

Date Written: December 31, 2013

Abstract

The Greek drama of the late 2000s has returned sovereign risk awareness to centre stage. The default affected a country with a relatively developed economy. It resulted in huge losses for the value of domestic assets: public debt, but also private debt, equity, real estate and furthermore pension rights and human capital. The burden has, not entirely but importantly, fallen on residents.

The questions that arise from the possibility of sovereign default impacting the sovereign’s subjects are how to properly assess the risk, what the fallout from its occurrence would be and what precautionary measures should be taken. International diversification is part of the answer.

Keywords: Sovereign risk, public finance, public debt, solvency, restructuration, taxation, sustainability, risk assessment, asset allocation

JEL Classification: E62, G11, H2, H6

Suggested Citation

Maillard, Didier, Sovereign Risk: A Reappraisal (December 31, 2013). Available at SSRN: https://ssrn.com/abstract=2375283 or http://dx.doi.org/10.2139/ssrn.2375283

Didier Maillard (Contact Author)

Conservatoire National des Arts et Métiers (CNAM) ( email )

292, rue Saint-Martin
Paris cedex 03, 75141
France

Amundi Asset Management ( email )

90 Boulevard Pasteur
Paris, 75015
France

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