Behind the Greek Default and Restructuring of 2012

The pedestrian narrative about the Greek financial crisis and default is that the country was fiscally mismanaged for a long time and failed to carry out needed structural reforms that could have improved economic growth prospects and enhanced the country's creditworthiness. Therefore, a default and debt restructuring were inevitable sooner or later — and certainly so once the financial markets were informed, as happened in October 2009, that prior governments had underestimated their budget deficit and public debt figures. In reality, Greece's road to default and debt restructuring in 2012 was not at all straightforward — and there was no historical inevitability about it, either