Apologies if the topic is not appropriate (economics newbie here) but I am curious as to who exactly would foot the bill if Greece defaults on the ~300 billion dollars it owes. It looks like most of the money is owed to EU, IMF and ECB but what does that really mean in layman terms? Does it mean that tax-payers in other (mostly EU) countries end up paying one way or the other.
Who would pay depends on the terms of the default. Sometimes holders of similar debts are not treated equally, and this can play out in different ways. Greeks could default on external debts but continue to pay internal creditors. Or because the ESM and other entities are providing ongoing financing, perhaps they will continue to be repaid when others are not to keep those spigots open. Or, less extremely, they could vary the degree of forbearance, term changes, and extent of default.
I found the following two charts from 2013 and 2014 helpful for understanding who are the current holders of Greek public debt and how that compares with other rich countries.
Source: STARLING CITY
Update: I couldn't find a time series of the holders of Greek debt but here are some additional charts to see the evolution. The first one is more comparable to the pie chart above than the second one which shows only bank holdings. If this is of interest, the BIS's consolidated banking statistics could be used to create a time series of the bank holdings of Greek debt
I'd add a historical perspective to the great answers already given. The data from a very illustrative article "The Greek Debt Restructuring: An Autopsy" by Jeromin Zettelmeyer, Christoph Trebesch, and Mitu Gulati.
The private creditors would bear the losses if Greece defaulted before March 2012
These organizations held the Greek debt by 2011:
The debt became public in March-April 2012
Zettelmeyer et al.:
The citizens of the EU would pay the bill now
You are correct. The majority of Greek sovereign debt is held by other EU sovereigns. So EU taxpayers end up footing the bill in the event of a Greek default. Usually, rather than outright defaulting (i.e. missing a repayment deadline), there will be some agreement to restructure the debt so that Greece gets more time or some other form of concession.
So the EU and Greece will both talk tough on TV to please their respective electorates, but both sides know that a genuine default would spell catastrophe for the entire European economy and so will do everything they can to avoid it.
We have first to be clear about what meaning do we give to the word "default". The other answer gave it a temporary meaning ("missing a payment deadline"). In such a case, any direct economic effect is bound to be small (expecially if the delay is short). But there may be indirect economic consequences through the effect on economic expectations.
Now let's give to the word "default" a heavy meaning: "non-payment ever of principal and interest", then there will be various direct and indirect effects:
The debt market loses Supply, reducing loan opportunities for other debtors. Creditors become more conservative and stringent towards prospective debtors, in view of the loss... in general the debt market suffers -and with it any beneficial economic activity that may need debt financing.
Creditors lose current income (the interest), and also become less wealthy. So their financial health worsens which affects directly their level of current engagement in economic activity, and also, their plunging into new economic activity, and so, the future. If the end-creditors are states, then their Government Budget suffers which may indeed lead also to higher taxation.
Consider now the following "economic fantasy" twist: Assume that a debtor state announces: "We cannot say when we will be able to start repaying the principal amount of the debt, but we will duly and fully pay the interest accrued in the meantime".... Is there a "bill to be footed" here? It would be very interesting to see what the consequences of such a situation would be. Unfortunately, in Social Sciences, there are all shorts of very interesting experiments that we cannot really execute, so we can only theorize about them, and hope for a "natural experiment" to emerge...
The answer is above. One important point to note that the other contributers missed is the effect of a default on derivative markets and greek corporations. Greek corporations credit ratings are heabily affected by the rating of the Greek Goverment. If Greece defaults or defaults on a payment (misses or restructures) their credit rating will be stronly negativley affected. This is likely to have a knock-on effect to greek corporation which will be negativley affected as well. Finally, if the greek goverment is defaulting on foreign obligations, it is likely that local obligations will not be met either (local goverment contractors, pensions etc.). This would harm the greek economy.
In terms of derivatives and financial markets many instruments such as greek goverment CDS (Credit Default Swaps - essentially a contract where one side pays the other if greece defaults by a certain time) would be triggered or affected by a default.
So to answer your question in addtion to the holders of the actual debt described above by other commentators - a lot of people would pay but some, like me, would make a killing becuase we are betting against greece.
Why bet against greece? It's a corrupt incompetant goverment and culture with an impossible debt burden. Instead of kicking the can down the road and prolonging the pain, they need to reorganize, deleverage and reform.