‘Market Discipline’, Lending Ceilings and Subnational Finance
研究市场纪律方法在地方财政中的应用，指出要消除中央救助的道德风险，需先创造违约和解决违约的条件，并探讨贷款上限作为允许违约而不拖累中央政府的工具。
Summary The ‘market discipline’ approach to subnational finance requires that moral hazard derived from the possibility of a central government bailout be made insignificantly small. Therefore, governments interested in following this approach and willing to abide by its rules should start by creating the conditions for a default and its resolution to be possible. This article discusses the use of lending ceilings as an instrument to allow the default, without dragging in the central government.