Public debt dynamics : the effects of austerity, inflation, and growth shocks /
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| Author / Creator: | Cherif, Reda. |
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| Imprint: | Washington, D.C. : International Monetary Fund, 2012. |
| Description: | 1 online resource (28 pages) : charts |
| Language: | English |
| Series: | IMF working paper ; WP/12/230 IMF working paper ; WP/12/230. |
| Subject: | |
| Format: | E-Resource Book |
| URL for this record: | http://pi.lib.uchicago.edu/1001/cat/bib/11157646 |
| Summary: | We study how macroeconomic shocks affect U.S. public debt dynamics using a VAR with debt feedback. Following a fiscal austerity shock, the debt ratio initially declines and then returns to its pre-shock path. Yet, the effect is not statistically significant. In a weak economic environment, the likelihood of a self-defeating austerity shock is much higher than in normal times. An inflation shock only slightly reduces the debt ratio for a few quarters. A positive growth shock unambiguously lowers debt. In our specification, the debt ratio is stationary, whereas a VAR excluding debt may imply an explosive debt path. |
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| Item Description: | At head of title: Institute for Capacity Development. "September 2012." |
| Physical Description: | 1 online resource (28 pages) : charts |
| Bibliography: | Includes bibliographical references (pages 14-16). |
| ISBN: | 1475541279 9781475541274 1475510551 9781475510553 1475565542 9781475565546 |