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'Illegitimate' loans: lenders, not borrowers, are responsible

Hanlon, Joseph (2006). 'Illegitimate' loans: lenders, not borrowers, are responsible. Third World Quarterly, 27(2) pp. 211–226.

URL: http://www.open.ac.uk/personalpages/j.hanlon/3WQ_i...
DOI (Digital Object Identifier) Link: https://doi.org/10.1080/01436590500432283
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Abstract

Debt relief has focused on the borrower - debt is cancelled if a country is too poor to repay and now has acceptable policies. Iraq shifted the focus to the lender - debt should be cancelled because creditors should never have lent money to the repressive regime. The paper uses domestic and international law to establish the concept of 'illegitimate debt', which should not be repaid independent of the status of the borrower. The concept of 'moral hazard' is used to argue that non-payment of illegitimate debt is necessary to discipline lenders and to prevent future lending to oppressive dictators.

Item Type: Journal Item
ISSN: 1360-2241
Keywords: illegitimate debt; debt; moral hazard; extortionate; loans
Academic Unit/School: Faculty of Arts and Social Sciences (FASS) > Social Sciences and Global Studies > Development
Faculty of Arts and Social Sciences (FASS) > Social Sciences and Global Studies
Faculty of Arts and Social Sciences (FASS)
Research Group: Innovation, Knowledge & Development research centre (IKD)
Related URLs:
Item ID: 2206
Depositing User: Joseph Hanlon
Date Deposited: 07 Jun 2006
Last Modified: 06 Aug 2019 08:24
URI: http://oro.open.ac.uk/id/eprint/2206
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