Debt resolution: moving on after the crisis
An excess of indebtedness is constraining economic growth in many economies. Indeed, the deleveraging since the financial crisis is exceptionally slow. Why is this the case, and what can be done about it?
In this episode of The Sound of Economics, we discuss the issue of indebtedness and debt resolution with Carmen Reinhart, Professor of the International Financial System at the Harvard Kennedy School.
Professor Reinhart highlights the scale of the debt overhang in many advanced economies. She also presents evidence that deleveraging has been notably slow since the last global financial crisis.
She discusses how this overhang is affecting the speed of recovery, and calls for debt restructuring – especially in the private sector.
We also hear from Bruegel Research Fellow Maria Demertzis, who explains the significance of non-performing loans and argues for simplified bankruptcy laws.
Carmen Reinhart, Professor of the international financial system, Harvard Kennedy School
Maria Demertzis, Research Fellow, Bruegel
Presented by Giuseppe Porcaro
Produced by Vanessa Cotterell and Giuseppe Porcaro