When Nations Can't Default

A History of War Reparations and Sovereign Debt

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War reparations have been large and small, repaid and defaulted on, but the consequences have almost always been significant. Ever since Keynes made his case against German reparations in The Economic Consequences of the Peace, the effects of transfer payments have been hotly debated. When Nations Can't Default tells the history of war reparations and their consequences by combining history, political economy, and open economy macroeconomics. It visits often forgotten episodes and tells the story of how reparations were mostly repaid - and when they were not. Analysing fifteen episodes of war reparations, this book argues that reparations are unlike other sovereign debt because repayment is enforced by military and political force, making it a senior liability of the state.

• Provides a thorough review of recent war reparations, which has not been compiled before
• Makes sovereign debt theory accessible to readers without specialized training in economics
• Gives readers an understanding of why countries pay reparations, even if it makes no economic sense and has disastrous consequences