Arbeitspapier
Ramifications of debt restructuring on the euro area: The example of large European economies' exposure to Greece
The Greek government budget situation plays a central role in the debt crisis in the euro area. The debt to GDP ratio is above 150 percent, while the deficit to GDP ratio exceeds 10 percent. To re-establish the Maastricht criteria, respectively, strong consolidation measures need to be implemented, with potential adverse effects on the Greek economy, and further credit requirements. Therefore, a debt conversion might become a reasonable alternative. The aim of this paper is to provide some simulation-based calculations on the expected fiscal costs for the governments in the large European countries Germany, France, Spain and Italy arising from different policy options - among them a potential second Greek rescue package. Under realistic conditions, a debt conversion may be the less costly strategy for Greece and the euro area partner states. A value-added of these calculations lies in a potential transfer to smaller euro area member countries.
- Language
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Englisch
- Bibliographic citation
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Series: DIW Discussion Papers ; No. 1141
- Classification
-
Wirtschaft
International Monetary Arrangements and Institutions
International Lending and Debt Problems
National Debt; Debt Management; Sovereign Debt
- Subject
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euro area debt crisis
debt conversation
Greece
Haushaltskonsolidierung
Staatsbankrott
Griechenland
Internationaler Transfer
Soziale Kosten
EU-Staaten
- Event
-
Geistige Schöpfung
- (who)
-
Belke, Ansgar
Dreger, Christian
- Event
-
Veröffentlichung
- (who)
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Deutsches Institut für Wirtschaftsforschung (DIW)
- (where)
-
Berlin
- (when)
-
2011
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
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Object type
- Arbeitspapier
Associated
- Belke, Ansgar
- Dreger, Christian
- Deutsches Institut für Wirtschaftsforschung (DIW)
Time of origin
- 2011
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