When Nations Can't Default
A History of War Reparations and Sovereign Debt

What happens when countries cannot default on its debt? This history of war reparations shows that state survival trumps economics.

Simon Hinrichsen (Author)

9781009343961, Cambridge University Press

Paperback / softback, published 8 May 2025

240 pages
22.9 x 15.2 x 1.4 cm, 0.395 kg

'In this insightful book, Hinrichsen analyses how and, more importantly, why war reparations have been paid, restructured, repudiated or simply ignored over the last two centuries. War reparations are unlike all other types of sovereign debt. If wars of aggression were exclusively a feature of earlier centuries, Simon Hinrichsen's book would be a fascinating study of how the monetary reparations payable to the victors in those conflicts were eventually handled. But as Russia's invasion of Ukraine in 2022 demonstrates, unprovoked aggression is not confined to earlier centuries and the international community may soon need to grapple, yet again, with the issue of war reparations.' Lee C. Buchheit, University of Edinburgh

War reparations have been large and small, repaid and defaulted on, but the consequences have almost always been significant. Ever since Keynes made his case against German reparations in The Economic Consequences of the Peace, the effects of transfer payments have been hotly debated. When Nations Can't Default tells the history of war reparations and their consequences by combining history, political economy, and open economy macroeconomics. It visits often forgotten episodes and tells the story of how reparations were mostly repaid - and when they were not. Analysing fifteen episodes of war reparations, this book argues that reparations are unlike other sovereign debt because repayment is enforced by military and political force, making it a senior liability of the state.

1. Introduction
2. A framework for war reparations
3. Sovereign debt
4. Napoleonic Wars reparations
5. Haiti indemnity and sovereign debt
6. Franco-Prussian War indemnities
7. Smaller 19th century war reparations
8. German World War I reparations
9. Russian and Bulgarian World War I reparations
10. World War II reparations to the Soviet Bloc.

Subject Areas: Macroeconomics [KCB]