Serial Defaults, Serial Profits: Returns to Sovereign Lending in Habsburg Spain, 1566-1600

Mauricio Drelichman; Hans-Joachim Voth

doi:10.1016/j.eeh.2010.08.002

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Serial Defaults, Serial Profits: Returns to Sovereign Lending in Habsburg Spain, 1566-1600

Mauricio Drelichman, Hans-Joachim Voth

Explorations in Economic History 48(1), pp. 1-19 (2011)

Published version

Abstract

Philip II of Spain accumulated debts equivalent to 60% of GDP. He also defaulted four times on his short-term loans. Contrary to a common view, we show that lending to the king was profitable even under worst-case scenario assumptions.

Keywords: sovereign debt, default, returns, Habsburg Spain, financial history
DOI: 10.1016/j.eeh.2010.08.002
Canonical: https://www.jvoth.com/papers/serial-defaults-serial-profits.html

Mauricio Drelichman, Hans-Joachim Voth (2011). “Serial Defaults, Serial Profits: Returns to Sovereign Lending in Habsburg Spain, 1566-1600.” Explorations in Economic History.