Hyungseok Joo

Dr Hyungseok Joo

Lecturer in Economics

Academic and research departments

Faculty of Arts and Social Sciences, School of Economics.



Research interests



Tamon Asonuma, Hyungseok Joo (2020)Sovereign Debt Restructuring: Delays in Renegotiation and Risk Averse Creditors, In: Journal of the European Economic Association Oxford University Press

Foreign creditors’ business cycles influence both the process and the outcome of sovereign debt restructurings. We compile two datasets on creditor committees and chairs and on creditor business and financial cycles at the restructurings, and find that when creditors experience high GDP growth, restructurings are delayed and settled with smaller haircuts. To rationalize these stylized facts, we develop a theoretical model of sovereign debt with multi-round renegotiations between a risk averse sovereign debtor and a risk averse creditor. The quantitative analysis of the model shows that high creditor income results in both longer delays in renegotiations and smaller haircuts. Our theoretical predictions are supported by data. (JEL: F34, F41, H63)

Hyungseok Joo, Yoon-Jin Lee, Young-Ro Yoon (2023)Effects of information quality on signaling through sovereign debt issuance, In: Journal of economic behavior & organization207pp. 279-304 Elsevier B.V

This paper develops a sovereign debt model proposing that a debt issuance can be a credible signaling channel between a sovereign government and foreign creditors. The government has private information regarding the future economy. The one with a good economic outlook would like to find a credible way to disclose it to obtain a high bond price. Foreign creditors are interested in inferring the government’s private information to assess sovereign default risk precisely. The government’s private information is imperfect, so the precision of information matters. We study how the interaction of the prior, the signal, and its precision affects the equilibrium and the resulting welfare. We propose a unique separating signaling equilibrium demonstrating the feature that a more precise signal of good economic outlook leads to a greater extent of fiscal austerity. As the information becomes more precise, the signaling cost for a government with a good economic outlook increases. Interestingly, unless the prior is very pessimistic, a highly precise signal harms the sovereign because a resulting strong signaling motive drives it to reduce bond issuance excessively (paradox of highly precise information).