Scholarlink

<p>The welfare of billions of people in developing economies is contingent upon income certainty. The likelihood of both internal and external shocks that now include pandemic and war is incalculable and impacts severely, particularly upon the poor and vulnerable. It is not surprising; therefore, the innovative financial instruments that have broad-based access are devised. We investigate the GDP-linked bond as a potential solution to mitigate these risks. The case of Emerging and Frontier and Developing Asia is considered here. The reason is a sharp drop of GDP we unearth using three sigma limits. Over the past four decades (1980 to 2019), the volatility of GDP growth of these countries reveals high downside risks. Consequently, it is imperative that these countries adopt policy measures that hedge downside income risks. Returns from GDP-linked bonds are allied to other countries GDP growth rate and, therefore, act as an external pull away from domestic distress. We claim it will help push up the rate of growth and increase the average income of people.</p>

错误：搜索内容不能为空，请输入英文关键词
错误：关键词超出字数限制，请精简
高级检索

Revisiting GDP-linked bonds for emerging and Frontier economies in Asia

  • 期刊论文

  • 发表日期：

    2025年5月24日

查看全文
  • Neeta Majumder,
  • Soumendu Bhattacharya

摘要

The welfare of billions of people in developing economies is contingent upon income certainty. The likelihood of both internal and external shocks that now include pandemic and war is incalculable and impacts severely, particularly upon the poor and vulnerable. It is not surprising; therefore, the innovative financial instruments that have broad-based access are devised. We investigate the GDP-linked bond as a potential solution to mitigate these risks. The case of Emerging and Frontier and Developing Asia is considered here. The reason is a sharp drop of GDP we unearth using three sigma limits. Over the past four decades (1980 to 2019), the volatility of GDP growth of these countries reveals high downside risks. Consequently, it is imperative that these countries adopt policy measures that hedge downside income risks. Returns from GDP-linked bonds are allied to other countries GDP growth rate and, therefore, act as an external pull away from domestic distress. We claim it will help push up the rate of growth and increase the average income of people.