Sovereign Debt Crisis: Euro-Reality

Sovereign Debt
Financial Crisis
Euro
Authors
Affiliations

Julius Horvath

Central European University

Alfredo Hernández Sánchez

Barcelona Institute of International Studies

Published

January 1, 2017

Doi

https://doi.org/10.1108/S1569-376720170000018019

Abstract

In the domestic credit market creditor and debtor rights are clearly defined. In contrast, sovereign debt repayment is largely contingent on the debtor government’s willingness to repay as enforcement of contracts at the international level is limited. In this chapter we explore different sources of sovereign debt crises as opportunistic and myopic behavior by debtor nations, over-consumption of imported goods, credit temptation by lenders eager to allocate savings surpluses, and unexpected consequences of initially seen appropriate policies. We explore how these factors have played out in the Euro-debt crisis and outline a framework for creditor responsibility to complement debtor self-restraint.

Citation

@inbook{Horvath2017,
  title = {Sovereign Debt Crisis: Euro-Reality},
  ISBN = {9781787145092},
  ISSN = {1569-3767},
  url = {http://dx.doi.org/10.1108/S1569-376720170000018019},
  DOI = {10.1108/s1569-376720170000018019},
  booktitle = {Economic Imbalances and Institutional Changes to the Euro and the European Union},
  publisher = {Emerald Publishing Limited},
  author = {Horvath,  Julius and Hernandez Sanchez,  Alfredo},
  year = {2017},
  month = aug,
  pages = {417–433}
}