Impact of Commodity Price Volatility on External Debt: The Role of Exchange Rate Regimes

Monoj Kumar Majumderad, Mala Raghavan () and Joaquin Vespignani

MPRA Paper from University Library of Munich, Germany

Abstract: This study explores the impact of commodity price volatility on external debt accumulation under fixed, managed, and floating regimes. We estimate dynamic panel data models for 97 countries from 1993 to 2016. Our empirical findings show that commodity price volatility increases external debt accumulation for commodity-exporting countries. This impact is three-times higher for countries with fixed exchange rate regimes compared to managed floating exchange rate regimes. Under floating exchange regimes, the effect of commodity price volatility on external debt is statistically insignificant. Our results suggest that the adoption of a floating exchange rate regime by commodity-exporting countries is critical to mitigating the effects of commodity price volatility on external debt accumulation

Keywords: Commodity price volatility; external debt; commodity-exporting countries; exchange rate regime (search for similar items in EconPapers)
JEL-codes: E0 E1 E3 (search for similar items in EconPapers)
Date: 2021-01-04
New Economics Papers: this item is included in nep-mac
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/105269/1/MPRA_paper_105269.pdf original version (application/pdf)

Related works:
Journal Article: Impact of commodity price volatility on external debt: the role of exchange rate regimes (2021)
Working Paper: Impact of Commodity Price Volatility on External Debt: The Role of Exchange Rate Regimes (2021)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:105269

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().