Sovereign Debt Default: Fiscal Policy’s Role and Future in Greece’s 21 st Century Crisis

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dc.contributorNeuhann, Daniel
dc.creatorGrosch, Morgan
dc.date.accessioned2024-02-22T16:10:27Z
dc.date.available2024-02-22T16:10:27Z
dc.date.issued2021-05
dc.description.abstractThe 2009 Greek sovereign debt crisis represented one of the first major tests of the economic and political stability of the European Union. While a significant body of research has been published regarding the immediate causes of the crisis, there are few papers which include an analysis of Greece’s fiscal actions in the decades preceding the crisis. This paper identifies Greece’s reform efforts aimed at securing entry into the European and Monetary Union (EMU) during the 1990s as instrumental to understanding the role of fiscal policy in the country’s sovereign debt crisis. A central finding of this paper is that in order to decrease its budget deficit and debt balance, Greece focused on revenue increases over more politically challenging expenditure cuts. Additionally, challenges related to tax evasion, reporting accuracy, and corruption affected Greece’s ability to balance its budget leading up to the 2009 crisis. In light of these findings, this paper assesses the long-term sustainability of Greece’s fiscal policy with respect to its budget. While Greece has demonstrated progress related to expenditures, taxes, and transparency, progress has been slow in reducing enduring expenditures such as government wages and pensions as well as structural changes to Greece’s budgetary infrastructure. In order to ensure the sustainability of its budget deficit and debt beyond 2021, Greece must effectively address these challenges.
dc.description.departmentFinance
dc.identifier.urihttps://hdl.handle.net/2152/123753
dc.identifier.urihttps://doi.org/10.26153/tsw/50547
dc.language.isoeng
dc.relation.ispartofPlan II Honors Theses - Openly Available
dc.rights.restrictionopen
dc.subjectSovereign debt
dc.subjectfiscal policy
dc.subjectGreece
dc.titleSovereign Debt Default: Fiscal Policy’s Role and Future in Greece’s 21 st Century Crisis
dc.typethesis

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