Ottoman and Greek Sovereign Debt and Bankruptcy: A Long-Term Comparative Analysis

The Ottoman and Greek sovereign defaults occurred in the era of major sovereign defaults throughout the Mediterranean, between the 1860s and the 1890s. Credit inflow from the main European financial markets increased and inflated the public debts of coun- tries situated on the periphery of the capitalist world economy. The search for higher investment returns placed European capitals on the periphery of the world economy, especially after the onset of the “Great Depression” in the last quarter of the nineteenth century. In this international environment, widespread administrative mis- management and an incessant need for financial resources pushed Constantinople and Athens into recurring financial troubles. This ar- ticle compares, from a long-term perspective, the problems associ- ated with the Ottoman and Greek public debts and consequent bankruptcies, bearing in mind the role of the European powers and the influence of European capitalist