Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/142722
Authors: 
Reinhart, Carmen M.
Trebesch, Christoph
Year of Publication: 
2015
Series/Report no.: 
Munich Discussion Paper 2015-17
Abstract: 
Two centuries of Greek debt crises highlight the pitfalls of relying on external financing. Since its independence in 1829, the Greek government has defaulted four times on its external creditors - with striking historical parallels. Each crisis is preceded by a period of heavy borrowing from foreign private creditors. As repayment difficulties arise, foreign governments step in, help to repay the private creditors, and demand budget cuts and adjustment programs as a condition for the official bailout loans. Political interference from abroad mounts and a prolonged episode of debt overhang and financial autarky follows. We conclude that these cycles of external debt and dependence are a perennial theme of Greek history, as well as in other countries that have been "addicted" to foreign savings.
JEL: 
F3
G01
H6
N10
N13
N14
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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