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Eurozone sovereign debt restructuring: keeping the vultures at bay

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  • Marcus Miller
  • Dania Thomas

Abstract

The eurozone debt crisis has stimulated lively debate on mechanisms for sovereign debt restructuring. The immediate threat of exit and the break-up of the currency union may have abated; but the problem of dealing with significant debt overhang remains. After considering two broad approaches—institutional versus contractual—we look at a hybrid solution that combines the best of both. In addition to debt contracts with collective action clauses, this includes a key amendment to the Treaty establishing the European Stability Mechanism, together with innovative state-contingent contracts and a special purpose vehicle to market them. Copyright 2013, Oxford University Press.

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  • Marcus Miller & Dania Thomas, 2013. "Eurozone sovereign debt restructuring: keeping the vultures at bay," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 29(4), pages 745-763, WINTER.
    • Handle: RePEc:oup:oxford:v:29:y:2013:i:4:p:745-763
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    Cited by:

    1. Ghosal Sayantan & Miller Marcus, 2015. "Writing-Down Debt with Heterogeneous Creditors: Lock Laws and Late Swaps," Journal of Globalization and Development, De Gruyter, vol. 6(2), pages 239-255, December.

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