Faculty Fellow Cesar Sosa Padilla recently published a paper in the United Nations University journal examining hidden sovereign debt in developing countries.
Due to major limitations and shortcomings, it is very difficult to determine the public debt level with a satisfactory degree of confidence.
Recently the issue of hidden debt through underreported or misreported liabilities has posed a challenge for the ability of stakeholders to make informed decisions, ultimately leading to inefficient economic outcomes and elevated crisis risks.
This paper looks at how to define and measure hidden debt, examines how sizable it is, and evaluates when and where underreporting is most severe.
Sosa-Padilla is an international macroeconomist with research interests in the fields of international finance, macroeconomics, and fiscal policy.