Public debt dynamics : the effects of austerity, inflation, and growth shocks /

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Bibliographic Details
Author / Creator:	Cherif, Reda.
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:	Debts, Public -- United States -- Econometric models. Fiscal policy -- United States -- Econometric models. Debts, Public -- Econometric models. Fiscal policy -- Econometric models. United States.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/11157646

Hidden Bibliographic Details
Other authors / contributors:	Hasanov, Fuad, 1978- International Monetary Fund. Institute for Capacity Development.
ISBN:	1475541279 9781475541274 1475510551 9781475510553 1475565542 9781475565546 9781475510553 9781475565546
Digital file characteristics:	data file
Notes:	At head of title: Institute for Capacity Development. "September 2012." Includes bibliographical references (pages 14-16).
Summary:	The author studies 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.
Standard no.:	10.5089/9781475541274.001

Table of Contents:

Cover; Abstract; Contents; I. Introduction; II. Related Literature; III. Empirical Model, Estimation, and Data; A. Empirical Model; B. Estimation and Impulse Responses; C. Data and Descriptive Statistics; IV. Public Debt Dynamics and Impulse Responses; A. Debt Impulse Responses to an Austerity Shock; B. Debt Impulse Responses to Inflation and Growth Shocks; V. Concluding Remarks; References; Tables; 1. Descriptive Statistics; Figures; 1. Evolution of Public Debt (Percent of GDP, 1947:II-2011:III); 2. Debt Impulse Response: The Effect of a One Standard Deviation Primary Surplus Shock.
3. Decomposition of the Debt Impulse Response under the Narrative Identification4. Debt Impulse Responses to a One Standard Deviation Primary Surplus Shock: Average Initial Conditions (Normal Times); 5. Debt Impulse Responses to a One Standard Deviation Primary Surplus Shock: Initial Conditions of 2011; 6. A Recent History and Forecast of the Debt Ratio Based on the Past Dynamics (2011:IV- ); 7. Debt Impulse Responses to Macro Shocks and Decomposition: Blanchard-Perotti Identification; A1. A Comparison of VAR Models: Debt Impulse Responses (GIR Identification); Appendix A.
A2. A Comparison of VAR Models: Debt Forecast, Starting 2011:IVA3. A Comparison of VAR Models: Debt Forecast, Starting 2009:III; Appendix B.

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