Structural changes in economy predict defaults in developing countries.
The article examines why some countries struggle to pay back their debts. It challenges the idea that the problem lies in how the borrowed money is used. Instead, it suggests that factors like saving habits and how much capital a country has are more important. By studying cases of countries that defaulted on their debts, the researchers found that specific changes in the economy often predict defaults. This suggests that these changes could help predict future defaults.