Abstract

The financing cost per unit of sovereign debt shows a significant difference in individual EU member-states. This article tries to find an explanation for this. As one of the reasons, it explores the phenomenon that in the wake of the financial crisis sovereign risk has become a factor seriously affecting interest rates both in the Euro-zone countries and the countries having their own currencies. The average interest cost is also affected by the choice of the countries to give priority to either cost or risk minimisation in their sovereign debt management strategies.  

Keywords: risk, management, sovereign debt, currency, cost minimization

JEL Classification: F34, N13, N24.

Cite as: Pulay, G. Z. (2018). Risk and cost of sovereign debt in the member states of the European Union as a factor of their economy development. Marketing and Management of Innovations, 1, 304-316. https://doi.org/10.21272/mmi.2018.1-23

This work is licensed under a Creative Commons Attribution 4.0 International License

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