Public Debt, Sustainability and Economic Growth - Theory and Empirics

Public debt has become a severe problem for a great many economies. While the effects of tax policies on the allocation of resources are readily derived, the mechanisms that make public deficits and debt influence the economy are not so easily understood. This book elaborates on the effects of public debt starting from the intertemporal budget constraint of the government. It is shown under which conditions a government can stick to the intertemporal budget constraint and then, demonstrated how public debt affects the growth process and welfare in market economies. The effects are derived for models with complete labor markets as well as taking into account labor market imperfections. The focus in this book is on fiscal policy issues, but it also deals with monetary policy aspects. The theoretical analysis is complemented with empirical time series analyses on debt sustainability and with panel studies dealing with the relationship between public debt and economic growth.

List of contents

Introduction.- Sustainable Public Debt: Theory and Empirical Evidence.- Debt and Growth: A Basic Endogenous Growth Model.- Productive Government Spending, Public Debt and Growth.- Government Debt and Human Capital Formation.- Debt and Growth: Empirical Evidence.- Conclusion.

Summary

Public debt has become a severe problem for a great many economies. While the effects of tax policies on the allocation of resources are readily derived, the mechanisms that make public deficits and debt influence the economy are not so easily understood. This book elaborates on the effects of public debt starting from the intertemporal budget constraint of the government. It is shown under which conditions a government can stick to the intertemporal budget constraint and then, demonstrated how public debt affects the growth process and welfare in market economies. The effects are derived for models with complete labor markets as well as taking into account labor market imperfections. The focus in this book is on fiscal policy issues, but it also deals with monetary policy aspects. The theoretical analysis is complemented with empirical time series analyses on debt sustainability and with panel studies dealing with the relationship between public debt and economic growth.

Product details

• Authors: Bettina Fincke, Alfre Greiner, Alfred Greiner
• Publisher: Springer, Berlin
• Languages: English
• Product format: Hardback
• Released: 27.06.2014
• EAN: 9783319093475
• ISBN: 978-3-31-909347-5
• No. of pages: 271
• Dimensions: 158 mm x 243 mm x 23 mm
• Weight: 595 g
• Illustrations: XVIII, 271 p. 59 illus., 3 illus. in color.
• Subjects: Social sciences, law, business > Business > Economics; B, macroeconomics, Economic theory & philosophy, Public Economics, Economics and Finance, Economic Theory, economic growth, Political Economy, Macroeconomics and Monetary Economics, Macroeconomics/Monetary Economics//Financial Economics, Monetary Economics, Management science, Quantitative Economics, Public finance, Public finance & taxation, International Political Economy, Development Economics, Development economics & emerging economies, Economic Theory/Quantitative Economics/Mathematical Methods, International Political Economy’