Why don't states default?

Abstract

This paper demonstrates how traditional rationalist theories failed to
prevent a default-like event during the 2008-13 Icesave dispute. Evidence
is presented to suggest that classic deterrents were not present or otherwise non-effective during the dispute and as such failed to prevent default.
Furthermore, it will be posited that the repayment agreement referendum
results were best explained by constructivist theories of international relations. Finally, it will be concluded that the result of the Icesave dispute
occurred due to the unique circumstances that invalidated traditional deterrents and brought constructivist incitements to the fore.