The conventional wisdom is that sovereigns repay their debts not because they fear litigation but because they wish to preserve their reputation in the capital markets or because they have some other incentive to repay. The ongoing case of NML Capital v. Argentina has the potential to shatter...

This essay revisits the role of legal enforcement in sovereign debt markets. The conventional view, which has long held sway in the economic literature, is that the law of sovereign immunity denies creditors effective legal remedies when governments do not repay their debts. To many observers,...

In 2016, its economy in shambles and looking to defer payment on its debts, the Venezuelan government of Nicolás Maduro proposed a multi-billion dollar debt swap to holders of bonds issued by the government's crown jewel, state-owned oil company Petroleós de Venezuela S.A. (“PDVSA”). A new...

The law of foreign sovereign immunity changed dramatically over the course of the 20th century. The United States abandoned the doctrine of absolute immunity and opened its courts to lawsuits by private claimants against foreign governments and officials. It also pursued a range of other...