debt sustainability meaning

0000002558 00000 n 0000080847 00000 n 2926 0 obj <> endobj 0000010261 00000 n 0000019302 00000 n However, there was a vicious cycle of recession and austerity: each round of austerity measures led to a deeper recession, which increased the debt-to-GDP ratio and therefore undermined the goal of debt sustainability, leading to another round of austerity. debt can put fiscal sustainability at risk even before considering the long-term expenditure trends influenced by population ageing. %%EOF endstream endobj startxref Mendoza, J. Zhang, Chapter 32 - What is a Sustainable Public Debt?, Editor(s): John B. Taylor, Harald Uhlig, Handbook of Macroeconomics, Elsevier, Volume 2, 2016, Pages 2493-2597, ISSN 1574-0048, ISBN 9780444594877, 0000011286 00000 n 535 0 obj <>stream @_��)�Hl���X��K��� ǩ���\���E����/+���.rG٘):gO )vh��} N����Ĵ�v�b�Yb�g�]�tJq뉀���@&��@L��z��R����# ���q� ����50t��!� L�@Yf�(����� ��X��A���(�pD.�@��р��8.؈F��H �Ē�$kL�K�68($j0�(H��L׿T�%L`����4�h2Cu�:���90��3���c g ��@z%o�L -��Й��X�n ҇x�� iF 20 N� %PDF-1.5 %���� 0000036293 00000 n D'Erasmo and Mendoza also acknowledge the generous support of the National Science Foundation under awards 1325122 and 1324740. 0000015829 00000 n 0000008018 00000 n The extent to which individual responses to household surveys are protected from discovery by outside parties depends... © 2020 National Bureau of Economic Research. 0000000016 00000 n List of boxes, figures and tables ii Glossary iii Executive summary vi 1 Introduction . 0000016238 00000 n 0000015301 00000 n 0000013156 00000 n This question is usually posed as asking whether the outstanding public debt and its projected path are consistent with those of the government's revenues and expenditures (i.e. xref Learn more. 0000006855 00000 n 0000011463 00000 n ��c2n�]��Q�O. 0000033014 00000 n 0000009162 00000 n 0000003110 00000 n 0000001301 00000 n We are also grateful to Juan Hernandez, Christian Probsting and Valentina Piamiotti for their valuable research assistance. 0000012758 00000 n We identify critical flaws in the traditional approach to evaluate debt sustainability, and examine three alternative approaches that provide useful econometric and model-simulation tools to analyze debt sustainability. P. D’Erasmo, E.G. %PDF-1.6 %���� 0000039277 00000 n 0000017487 00000 n In addition to working papers, the NBER disseminates affiliates’ latest findings through a range of free periodicals — the NBER Reporter, the NBER Digest, the Bulletin on Retirement and Disability, and the Bulletin on Health — as well as online conference reports, video lectures, and interviews. 0000041707 00000 n 0000039158 00000 n The 2020 Martin Feldstein Lecture: Journey Across a Century of Women, Summer Institute 2020 Methods Lectures: Differential Privacy for Economists, The Bulletin on Retirement and Disability, Productivity, Innovation, and Entrepreneurship, Conference on Econometrics and Mathematical Economics, Conference on Research in Income and Wealth, Improving Health Outcomes for an Aging Population, Measuring the Clinical and Economic Outcomes Associated with Delivery Systems, Retirement and Disability Research Center, The Roybal Center for Behavior Change in Health, Training Program in Aging and Health Economics, Transportation Economics in the 21st Century. 0000047084 00000 n sustainability meaning: 1. the quality of being able to continue over a period of time: 2. the quality of causing little…. The second is a structural approach based on a calibrated dynamic general equilibrium framework with a fully specified fiscal sector, which we use to quantify the positive and normative effects of fiscal policies aimed at restoring fiscal solvency in response to changes in debt. Introduction Borrowing, both by governments and private enti-ties, is an important tool for financing investment critical to achieving sustainable development, as well 0 0000002328 00000 n Debt Sustainability and Debt Management in Developing Countries . 487 49 What is sustainability and how can you create a more sustainable business strategy? 0000004573 00000 n 0000002141 00000 n 0000041338 00000 n The first approach is Bohn's non-structural empirical framework based on a fiscal reaction function that characterizes the dynamics of sustainable debt and primary balances. The views expressed in this paper are those of the authors and do not necessarily reflect those of the Federal Reserve Bank of Chicago, the Federal Reserve Bank of Philadelphia, the Federal Reserve System, the National Bureau of Economic Research. All Rights Reserved. 0000004347 00000 n 0000018472 00000 n 0000017108 00000 n %%EOF Here are four steps to transform your business purpose into profit. h�b```�e,lF� cb�����@�0��A�Y�@�@�[�����)�U�a�5��-����%>����3�����5���>|ې�U8E����!��W'2$ԫ�=P����#����)�,�~r'�&sN9�� �����ǵ�.קXpO(�ޤ��c)��4�0��3SB*Z]\�#J]]]CKC�B.-. 0000014073 00000 n 0000022537 00000 n 0000014506 00000 n The question of what is a sustainable public debt is paramount in the macroeconomic analysis of fiscal policy. Debt and debt sustainability 1. This new edition of the Debt Sustainability Monitor (DSM), by providing an update of fiscal sustainability challenges in the EU, contributes to the monitoring and coordination of euro area Member States' fiscal policies and the aggregate fiscal stance for the euro area to ensure a … startxref 2942 0 obj <>/Filter/FlateDecode/ID[<0FFC7B6E89640B4A8C76BACFEBF48957>]/Index[2926 28]/Info 2925 0 R/Length 90/Prev 801961/Root 2927 0 R/Size 2954/Type/XRef/W[1 3 1]>>stream whether fiscal solvency conditions hold). This paper was prepared for Volume 2 of the Handbook of Macroeconomics. trailer h�b```b``����� �� Ȁ �@1v�5`�A7�e� O�,,�H���Ͼ (��Jc�i�M��'�.���� 0000005475 00000 n First, debt sustainability does not easily translate into operational concepts and indicators. Second, servicing the debt is a strategic decision, the result of a cost-benefit analysis. This question is usually posed as asking whether the outstanding public debt and its projected path are consistent with those of the government's revenues and expenditures (i.e. In 2016 most EU Member States have a government debt-to-GDP ratio above the 60% of GDP Treaty threshold. 0000080808 00000 n 0000014881 00000 n The third approach deviates from the others in assuming that governments cannot commit to repay their domestic debt, and can thus optimally decide to default even if debt is sustainable in terms of fiscal solvency. 0000039392 00000 n Learn more. The question of what is a sustainable public debt is paramount in the macroeconomic analysis of fiscal policy. 0000046219 00000 n 487 0 obj <> endobj It explains that austerity was imposed in the name of debt sustainability. We use these three approaches to analyze debt sustainability in the United States and Europe after the recent surge in public debt following the 2008 crisis, and find that all three raise serious questions. 0000046602 00000 n 0000041018 00000 n endstream endobj 2927 0 obj <. 0000004461 00000 n sustainability definition: 1. the quality of being able to continue over a period of time: 2. the quality of causing little…. whether fiscal solvency conditions hold). 0000016724 00000 n 2953 0 obj <>stream 0000004999 00000 n 1. 0000005573 00000 n Contents . <<3BE2E54DAE16B344B0AD64CC757173EB>]/Prev 225839/XRefStm 2141>> 1.1 Brief history of debt issues in developing countries 1 1.2 Progress under the HIPC Initiative and MDRI 2 1.3 Understanding and measuring debt sustainability 3 1.4 The current debate on debt sustainability 3 0000006179 00000 n h�bbd```b``I��k�dX�D2��Hvk� �U���`��`3)#$�3�"�`�"@�D#�_�P�d�?÷�� ~i4 i . 0000015741 00000 n 0000003611 00000 n 0 We are grateful to our discussant, Kinda Hachem, and to the volume editors, Harald Uhlig and John Taylor, for their comments and suggestions. 0000002523 00000 n

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