The Federal domestic debt and state governments : the impact of the state debts on the federal governemnt finances

This paper investigates how the finances of the Brazilian federal government responded to innovations in the debts of the most indebted states, São Paulo, Minas Gerais, Rio de Janeiro and Rio Grande do Sul. Using monthly data from 1981 to 1998, a vector autoregression system (VAR) is estimated to investigate the relationship between the federal government finances and the state debts. Results have indicated that state debts are relatively important to the forecast of the federal domestic debt when compared to the impact of a shock to government expenditures or tax revenues, but the effect of the state debts on the federal debt is very small when compared to the effects of a shock to the real interest rate.

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Year of publication:	2000
Authors:	Luporini, Viviane
Institutions:	Centro de Desenvolvimento e Planejamento Regional (Cedeplar), Universidade Federal de Minas Gerais
Subject:	Federal debt \| state debts \| fiscal consolidation \| Brazil

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Extent:	application/msword
Series:	Textos para Discussão Cedeplar-UFMG. - ISSN 2318-2377.
Type of publication:	Book / Working Paper
Notes:	Published in Revista de Economia Aplicada, 2000. 18 pages
Classification:	H63 - Debt; Debt Management
Source:	RePEc - Research Papers in Economics