Default Risk and Income Fluctuations in Emerging Economies by Cristina Arellano. Published in volume 98, issue 3, pages 690-712 of American Economic Review, June 2008, Abstract: Recent sovereign defaults are accompanied by interest rate spikes and deep recessions. Default Risk and Income Fluctuations in Emerging Economies Author. Abstract. Recent sovereign defaults are accompanied by interest rate spikes and deep recessions. This paper develops a Suggested Citation. Cristina Arellano, 2008. VOL. 98 NO. 3 ARELLANO: DEFAULT RISK AND INCOME FLUCTUATIONS IN EMERGING ECONOMIES 691 The model in this paper accounts for the empirical regularities in emerging markets as an equilibrium outcome of the interaction between risk neutral creditors and a risk averse bor-rower that has the option to default. The borrower is a benevolent government. Default Risk and Income Fluctuations in Emerging Economies by Cristina Arellano. Published in volume 98, issue 3, pages 690-712 of American Economic Review, June 2008, Abstract: Recent sovereign defaults are accompanied by interest rate spikes and deep recessions. This paper develops a small open e. "Default Risk, the Real Exchange Rate and Income Fluctuations in Emerging Economies," 2005 Meeting Papers 516, Society for Economic Dynamics. Fernando Broner & Alberto Martin & Jaume Ventura, 2010. " Sovereign Risk and Secondary Markets ," American Economic Review , American Economic Association, vol. 100(4), pages 1523-1555, September. Default risk and income fluctuations in emerging economies Arellano, Cristina University of Minnesota, Federal Reserve Bank of Minneapolis 2008 Online at https://mpra.ub.uni-muenchen.de/7867/ MPRA Paper No. 7867, posted 21 Mar 2008 06:02 UTC. DefaultRisk. 1 févr. 2008 · Download Citation | Default Risk and Income Fluctuations in Emerging Economies | Recent sovereign defaults are accompanied by interest rate spikes and deep recessions. This paper develops a small.