THE BAIL-OUT! POSITIVE POLITICAL ECONOMICS OF GREEK-TYPE CRISES IN THE EMU

Christian Fahrholz and Cezary Wójcik

Journal of International Commerce, Economics and Policy (JICEP), 2012, vol. 03, issue 02, 1-18

Abstract: The Greek bail-out was highly controversial. An oft-heard assessment is that (i) the bail-out was a mistake, (ii) the political haggling over it was irrational. Contrary to this view, our analysis suggests that, given EMU's present political-economic set-up, (i) the bail-out was unavoidable and (ii) the lengthy process of political haggling leading to it was understandable. We have based our analysis on a political-economic, game-theoretic model that helps to understand why and how the parties involved in the Greek crisis arrived at the bail-out and on what conditions the final solution depended.

Keywords: Bail-out; negative externality; political economics; game theory; euro; EMU; JEL Classifications: E62; JEL Classifications: F33; JEL Classifications: H77; JEL Classifications: C70 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.worldscientific.com/doi/abs/10.1142/S179399331250010X
Access to full text is restricted to subscribers

Related works:
Working Paper: The Bail-Out! Positive Political Economics of Greek-type Crises in the EMU (2010)
Working Paper: The Bail-Out! Positive political economics of Greek-type crises in the EMU (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:jicepx:v:03:y:2012:i:02:n:s179399331250010x

Ordering information: This journal article can be ordered from

DOI: 10.1142/S179399331250010X

Access Statistics for this article

Journal of International Commerce, Economics and Policy (JICEP) is currently edited by Ramkishen S. Rajan

More articles in Journal of International Commerce, Economics and Policy (JICEP) from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().