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The Aftermath of Sovereign Debt Crises: A Narrative Approach

Rui Esteves et al.

The Journal of Economic History2026https://doi.org/10.1017/s0022050725100995article
AJG 3ABDC A*
Weight
0.55

Abstract

This paper investigates the causal effects of sovereign debt crises in a sample of 50 defaulting economies between 1870 and 2010. As default is potentially endogenous, we use the narrative approach to identify plausibly exogenous episodes. We find economically and statistically significant costs of up to 3.2 percent of GDP before recovering to the pre-crisis level after five years. The average aftermath, however, conceals a large heterogeneity by default cause. Defaults originating from negative supply shocks, political crises, or adverse terms of trade are associated with higher costs. Demand shocks, in contrast, have a moderate effect that is quickly reversed.

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https://doi.org/https://doi.org/10.1017/s0022050725100995

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@article{rui2026,
  title        = {{The Aftermath of Sovereign Debt Crises: A Narrative Approach}},
  author       = {Rui Esteves et al.},
  journal      = {The Journal of Economic History},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1017/s0022050725100995},
}

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The Aftermath of Sovereign Debt Crises: A Narrative Approach

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Evidence weight

0.55

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.58 × 0.4 = 0.23
M · momentum0.60 × 0.15 = 0.09
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.