Rego, Juan C., "Growing with Debt: Strategies for Argentina", 1991
Argentina’s economic growth is seriously threatened by the service of the external debt, when this is compared with Argentina’s payment capacity. The difficulties in the accomplishment of the mentioned payments has caused the decrease of the value of the Argentine debt’s bonds in the secondary markets. This has carried on to the formulation of repurchase strategies of the debt, proposed by Fernandez (1987) and Rodriguez (1988, 1990), which are examined here. For this purpose a simple growth model type Harrod-Domar is coupled to the debt, which grows in function of the unpaid service. Meanwhile, the market price of the debt is governed by a behaviour equation, formulated by Rodriguez ( 1990). A resulting System Dynamics model, which continues a previous work (Rego 1988), permits to simulate alternative scenarios for the economic growth and debt management.
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