The latest episode of the eurozone crisis casts doubt on the basic premise of most economic models – that economic agents, and governments, always act rationally, after assessing the costs and benefits of alternative options.

Over the past two years, Greece has repeatedly stated its intention to stay in the eurozone, the cost of leaving it being much higher than that of implementing the policy adjustment required to remain a member. At the same time, Greece systematically tried to water down and postpone the adjustment measures, expecting the International Monetary Fund and Eurogroup ultimately to give in to avoid the financial contagion that would result from a Greek exit. But the European authorities never blinked and, each time, the Greek government and parliament had to rush to approve the measures before the deadline. The last-minute decisions were justified to the people with the need to meet Europe’s conditions.

The recent elections confirmed that Greek voters want to stay in the eurozone, but imagine they can do so on better terms. Again, Europe and the IMF did not blink. A new Greek election may further boost the anti-euro camp, fuelled by expectations that Europe will eventually waver and that the costs of exiting the euro might not be that large after all.