This paper explores the relationship between fiscal deficit, trade deficit and private consumption in European countries in the years 1970-2010. The aim of the study is to test empirically the validity and rationale of the Keynesian proposition (conventional view or Twin Deficits hypothesis) and...

Public debt is a burden on future electors and taxpayers. In the absence of constitutional constraints, the incumbent government may show the cost of some public expenditures or tax reductions toward the future by financing them via new debt. However, according to the Ricardian theorem of public...

We assess the sustainability of fiscal policy in the EU-28 countries over the 1980-2015 years. Panel unit root tests in presence of cross-sectional dependence show that government revenues, expenditures, the primary balance, and debt are non-stationary series. However, cointegration tests reveal...

The aim of this study is to assess the relationship between trade balance and public budget in the ASEAN countries. Using yearly data for the period between 1980 and 2012 in ten member states, a long-run relationship between current account balance and net lending emerge, both in ASEAN-6 and in...

In this paper, we analyse the relationship between public primary deficit and debt for Italian sustainability over the 1862–2013 years. Our empirical strategy uses the wavelet analysis. The empirical evidence suggests the presence of a substantial fiscal sustainability in the long run for...