A Discourse Theoretical Approach to Sovereign Debt Restructuring: Towards a Democratic Financial Order

  • Matthias Goldmann
  • Silvia Steininger
Part of the Beiträge zum ausländischen öffentlichen Recht und Völkerrecht book series (BEITRÄGE, volume 273)


This chapter studies the role of law for aligning democracy with a market-based financial order. Jürgen Habermas’s discourse theoretical understanding of the role of law in the welfare state establishes a structure for exploring this issue. According to this approach, law needs to be enforceable, law-making and law-application need to be institutionally separated, and public law needs to be distinguishable from private law. The contemporary practice of sovereign debt restructuring reveals some empirical and normative challenges to this understanding of the law. Based on these findings, this chapter proposes several conceptual and institutional improvements that might lead to a more stable relationship between democracy and financial order. In particular, we argue that sovereign debt restructuring should tap the legitimating potential of existing transnational discourses that are characterized by cross-border cleavages in public discourse.



We are highly indebted to Franz Ebert for discussions and advice. We would like to thank Armin von Bogdandy, Kolja Möller, Michael Zürn, Floris de Witte and Francesco Costamagna as well as the participants in the workshop “Democracy and Financial Order – Legal Perspectives” at Goethe University Frankfurt in September 2015 for their helpful comments. We are grateful to Tante Hildegard for hosting us during a retreat. This research was enabled by the DFG funded cluster of excellence “Formation of Normative Orders” at Goethe University Frankfurt.


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Authors and Affiliations

  1. 1.Goethe University FrankfurtFrankfurt a.M.Germany
  2. 2.Max Planck Institute for Comparative Public Law and International LawHeidelbergGermany

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