Every country faces what economists call an intertemporal (across time) budget constraint, which requires that its government's future expenditures, including the servicing of its outstanding official debt, be covered by its government's future receipts when measured in present value. The...

Governments in emerging markets often behave like a quot;tormented insurer,quot; trying to use non-state-contingent debt instruments to avoid cuts in payments to private agents despite large fluctuations in public revenues. In the data, average public debt-GDP ratios decline as the variability...

This paper assesses the fiscal sustainability hypothesis for 10 Eastern and Central European countries (CEEC) between 1997 and 2019. The study adopts very recent panel econometric techniques which accounts for issues of structural breaks and cross-sectional dependence in the data generating...

Angesichts diverser EURO-Rettungsschirme und der Sorge um den Verlust eigenen Wohlstands durch Umverteilung staatlicher Einnahmen zu Gunsten anderer EURO-Länder einerseits und der Entwertung privater Ersparnisse durch Ausweitung der Geldmenge andererseits, befürchten Bürger zunehmend, dass...

Equilibrium models imply that the real value of debt in the hands of the public must equal the expected present-value of surpluses. Empirical models of fiscal policy typically do not impose this condition and often do not even include debt. Absence of debt from empirical models can produce...

This article argues that flat opposition to revenue increases has contributed to U.S. economic vulnerability and has had unintended effects, including contributing to increased deficits instead of smaller government. The article distinguishes fundamental income tax reform from raising revenues...