---
title: The Sovereign Constraint: Sentiment, Markets, and the Limits of Foreign Policy
url: https://www.ml-quant.com/papers/repec/ema-worpap-2026-14/
site: ML-Quant (https://www.ml-quant.com)
updated: 2026-10-30
license: Summaries CC BY 4.0; links go to the original sources
index: https://www.ml-quant.com/llms.txt
identifier: RePEc:ema:worpap:2026-14
source_url: https://econpapers.repec.org/RePEc:ema:worpap:2026-14
featured: 2026-10-30
citations: unknown
topic: Macro-Finance & Rates
---


# The Sovereign Constraint: Sentiment, Markets, and the Limits of Foreign Policy

A framework shows how domestic political polarization shifts both portfolio demand in sovereign bond markets and government incentives in crises, creating a sentiment-driven constraint on confrontational foreign policy.

- Source: https://econpapers.repec.org/RePEc:ema:worpap:2026-14
- Identifier: RePEc:ema:worpap:2026-14
- Released: 2026-10-26
- First featured: Quant Letter No. 137 (2026-10-30): https://www.ml-quant.com/issues/2026-10-30/
- Citations (Semantic Scholar): not tracked
- Published in: not yet
- Topic: Macro-Finance & Rates
- Authors: Stéphane Auray, Frédéric Loss

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