Croce, Enzo; Juan-Ramon, V. Hugo - International Monetary Fund (IMF) - 2003
To monitor fiscal sustainability, this paper proposes a recursive algorithm derived from the law of motion of the debt …-to-GDP ratio, subject to a government reaction function that links convergence to the targeted debt ratio with primary fiscal … according to their degree of sustainability. For a number of countries, the paper finds evidence of causality between the fiscal …