Economics
The Political Economy of Sovereign Debt Restructuring
Quick fact
In the 2012 Greek debt restructuring, private creditors ultimately lost about 74% of the face value of their Greek bonds—the largest sovereign debt haircut in history—after months of political brinkmanship and market turmoil.
Why this is interesting
When a country can't pay its debts, why do creditors and governments often take years to reach a deal, even when everyone knows a default is inevitable? The answer lies not in economics, but in the messy politics of who gets paid first.