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 and iii) the bail-out will create a moral hazard problem. Contrary to this view, our analysis suggests that, given EMU's present...

We analyse the background of the Greek debt crisis and evaluate the three Greek financial assistance programme. The crisis and the first programme's (2010-11) failure were mainly the result of misguided internal policies. The second programme (2012-14) achieved progress towards recovery but this...

We build a no-arbitrage model of the yield curves in a heterogeneous monetary union with sovereign default risk, which can account for the asymmetric shifts in euro area yields during the Covid-19 pandemic. We derive an affine term structure solution, and decompose yields into term premium and...