Sovereign debt and incentives to default with uninsurable risks
证明，如果债务合同没有直接制裁支持，且违约仅导致被禁止再借款，即使存在不可保险风险和利率变化，主权债务也无法持续。
We show that sovereign debt is unsustainable if debt contracts are not supported by direct sanctions \nand default carries only a ban from ever borrowing in financial markets even in the presence of \nuninsurable risks and time-varying interest rate. This extension of Bulow and Rogoff (1989) requires \nthat the present value of the endowment be finite under the most optimistic valuation. We provide \nexamples where this condition fails and sovereign debt is sustained by the threat of loss of insurance \nopportunities upon default, despite the fact that the most pessimistic valuation of the endowment, the \nnatural debt limit, is finite.