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GDP-linked bonds: A primer

Cecchetti, Stephen, Schoenholtzm Kim, (2017), “GDP-linked bonds: A primer “, VoxEu, 1 March

Policymakers and economists have been looking for ways to make it easier to manage increasing debt burdens. This column assesses one possible solution: GDP-linked bonds that tie the size of debt payments to an economy’s wellbeing. There are clear benefits to a government from issuing GDP-linked bonds, but establishing investor confidence in these instruments will require a better approach to the obstacles posed by data revisions and changes in methodology.

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