Contingent sovereign debt can create important welfare gains. Nonetheless, there is almost no issuance today. Using hand-collected archival data, we examine the first known case of large-scale use of state-contingent sovereign debt in history. Philip II of Spain entered into hundreds of...

"Why do lenders time and again loan money to sovereign borrowers who promptly go bankrupt? When can this type of lending work? As the United States and many European nations struggle with mountains of debt, historical precedents can offer valuable insights. Lending to the Borrower from Hell...

Frontmatter -- Contents -- Acknowledgments -- Prologue -- Chapter 1. Lending to the Sound of Cannon -- Chapter 2. Philip'S Empire -- Chapter 3. Taxes, Debts, and Institutions -- Chapter 4. The Sustainable Debts of Philip Ii -- Chapter 5. Lending to the Borrower from Hell -- Chapter 6. Serial...