Download or read book Public Debt in a Descriptive Endogenous Growth Model written by Alfred Greiner and published by . This book was released on 2019 with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we analyze a descriptive endogenous growth model with public debt. The government can run into debt, but, the primary surplus is a positive function of the debt to GDP ratio such that the debt ratio becomes a mean-reverting process. We show that a balanced budget scenario yields a higher long-run growth rate than a scenario with permanent deficits if and only if the public deficit exceeds the net saving out of government bonds. As regards the dynamics, the analysis shows that multiple balanced growth paths can arise. Further, reducing the reaction of the primary surplus to a higher public debt can generate endogenous cycles via a Hopf bifurcation and, for a sufficiently low reaction coefficient, the economy becomes unstable.

Download or read book Public Debt Sustainability and Economic Growth written by Alfred Greiner and published by Springer. This book was released on 2014-10-14 with total page 284 pages. Available in PDF, EPUB and Kindle. Book excerpt: 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.

Download or read book Public Debt and Economic Growth written by Alfred Greiner and published by Springer Science & Business Media. This book was released on 2009-07-24 with total page 148 pages. Available in PDF, EPUB and Kindle. Book excerpt: Starting point of this book is the observation that an increase in public debt must be accompanied by a rise in the primary surplus of the government to guarantee sustainability of public debt. The book first elaborates on that principle from a theoretical point of view and then tests whether empirical evidence for that rule can be found. Additional tests are implemented to gain further evidence on sustainability of public debt. In order to allow for time varying coefficients penalized spline estimations are performed. The theoretical chapters present endogenous growth models and assume that the primary surplus rises as public debt increases so that sustainability of public debt is given. Implications of public deficits and debt are studied assuming full employment and for unemployment. The conclusion summarizes the findings and compares the results of the different models. Finally, policy implications are given showing how governments should deal with high public debt to GDP ratios.

Download or read book Public Debt and Endogenous Growth written by Michael Bräuninger and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 186 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book considers public debt dynamics in various endogenous growth mod els, namely the AK model and explicit models of innovation and human cap ital accumulation. Furthermore, the closed economy, the small open economy and a two-country world are analysed. In the closed economy model, the focus is on budget deficit and public debt dynamics and their influence on capital growth and output growth. Then, in the open economy model, the effects on foreign debt growth are considered. In a two-country setting, public debt growth in one country affects growth in the other country. In each scenario the government either fixes the deficit ratio or the tax rate. For both strategies the steady state is derived and stability is analysed. Then, dynamics induced by various shocks and policy measures are explored. Many diagrams illustrate the dynamics. I greatly benefited from comments by Michael Carlberg. In addition, Alkis Otto and Justus Haucap discussed with me many parts of the book. I wish to thank them all. Hamburg, February 2003 Michael Briiuninger Contents 1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 . . . . . . . . . . . . . . Part I The Closed Economy with AK Production 2 The Solow Model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 . . . . . . . . . . 2. 1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2. 2 Fixing the Deficit Ratio. . . . . . . . . . . . . . . . . . . . . . . . . . 6 . . . . . . . . 2. 2. 1 The Model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 . . . . . . . . . 2. 2. 2 Stability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 2. 2. 3 Some Shocks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 . . . . . . . . . 2. 2. 4 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 2. 3 Fixing the Tax Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 . . . . . . . . . 2. 3. 1 The Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 2. 3. 2 Stability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 2. 3. 3 Some Shocks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 . . . . . . . . . 2. 3. 4 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Download or read book The U S Public Debt written by Mr.Carlos M. Asilis and published by International Monetary Fund. This book was released on 1994-01-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: The increase in the U.S. public debt over the past twelve years raises questions about its implications for investment and economic growth. This paper places these developments within an international and historical context and quantitatively examines the implications of various measures of the current U.S. public debt-to-GDP ratio on economic growth. The analysis is undertaken through extensions of recently developed endogenous growth models. The results suggest that while higher levels of the public debt may affect long-run economic growth negatively, the order of magnitude is not large enough to be a cause for serious concern.

Download or read book Government Debt Human Capital and Endogenous Growth written by Jie Zhang and published by . This book was released on 1995 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The U S Public Debt written by Carlos Asilis and published by . This book was released on 2006 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: The increase in the U.S. public debt over the past twelve years raises questions about its implications for investment and economic growth. This paper places these developments within an international and historical context and quantitatively examines the implications of various measures of the current U.S. public debt-to-GDP ratio on economic growth. The analysis is undertaken through extensions of recently developed endogenous growth models. The results suggest that while higher levels of the public debt may affect long-run economic growth negatively, the order of magnitude is not large enough to be a cause for serious concern.

Download or read book Sustainability and Optimality of Public Debt written by Michael Carlberg and published by Springer Science & Business Media. This book was released on 2012-12-13 with total page 220 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book studies the sustainability and optimality of public debt under different scenarios: the closed economy, the small open economy, and a two-country setting. Sustainability refers to the existence and the stability of the long-run equilibrium. Optimality relates to the path of public debt that maximizes discounted utility. The analysis is conducted within the framework of the Solow model, the overlapping generations model and the infinite horizon model. The government can follow different strategies, it either fixes the deficit ratio or the tax rate. As a result, a fixed deficit ratio generally can be sustained. By contrast, a fixed tax rate generally cannot be sustained. Depending on the chosen fiscal strategy, there exists either an optimal deficit ratio or an optimal tax rate that maximizes the sum of consumption and government purchases per capita.

Download or read book Public Debt and Public Investment in an Endogenous Growth Model with Real Wage Rigidities written by Alfred Greiner and published by . This book was released on 2012 with total page 27 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we present an endogenous growth model with public capital, public debt and where real wages are either flexible or rigid due to labor market imperfections. With flexible wages, a balanced budget scenario yields the highest balanced growth rate. Further, simulations suggest that there is a trade-off between positive growth effects of deficit financed public investment and stability of the model. With real wage rigidities, a balanced budget scenario may yield a lower balanced growth rate compared to permanent public deficits. Further, the trade-off between growth effects of deficit financed investment and stability does not exist.

Download or read book Public Debt Global Governance and Economic Dynamism written by Luigi Paganetto and published by Springer Science & Business Media. This book was released on 2014-07-08 with total page 367 pages. Available in PDF, EPUB and Kindle. Book excerpt: This volume presents a selection of contributions to the XXIV Villa Mondragone International Economic Seminar on “Public debt, global governance and economic dynamism”. For the past 23 years, the Seminar has provided an ideal opportunity to meet and discuss the most topical issues in economic research. The quality of the scientific contributions and ensuing debates has consistently been outstanding owing to the participation of leading experts, and the most recent Seminar was no exception. The Seminar was held against the backdrop of high levels of public debt, especially in Europe, combined with very low growth in productivity. Furthermore, markets have been dominated by financial instability, raising the question of whether this is the result of the high debt levels or insufficient economic dynamism. Among the topics covered in this book are the economic challenges and growth policies in the United States; issues relating to the G20, global governance and regional integration; EU governance, growth and the Eurozone crisis; and EMU policy and public debt. Individual contributions also address the impact of labor market reforms, the need for sectoral rebalancing in the Euro area, fiscal multipliers and public debt dynamics, and the effects of fiscal shocks in Italy. The book concludes with a contribution on policy recommendations.

Download or read book The Forces of Economic Growth written by Alfred Greiner and published by Princeton University Press. This book was released on 2005 with total page 222 pages. Available in PDF, EPUB and Kindle. Book excerpt: Publisher Description

Download or read book Public Debt Productive Public Spending and Endogenous Growth written by Alfred Greiner and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Public Debt and Growth written by Jaejoon Woo and published by International Monetary Fund. This book was released on 2010-07-01 with total page 49 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper explores the impact of high public debt on long-run economic growth. The analysis, based on a panel of advanced and emerging economies over almost four decades, takes into account a broad range of determinants of growth as well as various estimation issues including reverse causality and endogeneity. In addition, threshold effects, nonlinearities, and differences between advanced and emerging market economies are examined. The empirical results suggest an inverse relationship between initial debt and subsequent growth, controlling for other determinants of growth: on average, a 10 percentage point increase in the initial debt-to-GDP ratio is associated with a slowdown in annual real per capita GDP growth of around 0.2 percentage points per year, with the impact being somewhat smaller in advanced economies. There is some evidence of nonlinearity with higher levels of initial debt having a proportionately larger negative effect on subsequent growth. Analysis of the components of growth suggests that the adverse effect largely reflects a slowdown in labor productivity growth mainly due to reduced investment and slower growth of capital stock.

Download or read book Government Debt and Productive Government Spending in an Endogenous Growth Model written by Sunyoung Hong and published by . This book was released on 1992 with total page 228 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Public Debt and Economic Growth Evidence from Euro Area Countries written by Tasos Stylianou and published by LAP Lambert Academic Publishing. This book was released on 2014-08-08 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: The aim of this monograph is to present and analyze the relationships between public debt and economic growth in European countries for the period of 1990 to 2013. The monograph consists of two parts. The first part deals with the theoretical analysis of the relationships between public debt and economic growth, including descriptive statistics and the evolution of the two basic variables, the variable of public debt ratio and the variable of growth rates, for eight European countries (Austria, France, Germany, Greece, Italy, Portugal, Spain and UK). The next part deals with the empirical analysis for Greece. During the last decade Greece is facing many economic problems. The economy is teetering on the brink of bankruptcy and the debt deepens. In this part we examine whether the debt is promoting economic growth in Greece. We use time series data from 1980 to 2010 and the data are fitted into the regression equation using econometric techniques. We are testing the variables with techniques such as Zivot Andrew's, Perron's and Bai Perron's tests to find any structural breaks. Then we are testing if there is any causal effect in the model with Granger causality test.

Download or read book Estimating an Endogenous Growth Model with Public Capital and Government Borrowing written by Alfred Greiner and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper presents and estimates an endogenous growth model with public capital. In contrast, however, to recent studies on economic growth and policy, we allow for capital market borrowing by the government. Since the behavior by the government (tax rates, spending and borrowing) does not follow optimizing rules, we introduce regimes (rules) which define the behavior of the government. In strict regimes government borrowing is used for public investment. In less strict regimes it can also be used for debt service and public investment. In our model variants government deficit does not necessarily entail a lower growth rate of the economy but the growth defects are different according to which rules are adopted. Moreover, in our context the growth maximizing income tax rate is different from zero. The model, contingent on the regime prevailing, can exhibit multiple equilibria and local and global indeterminacy. For two relevant regimes which roughly correspond to the cases of the U.S. and Germany the model is estimated by employing time series data from 1952 to 1990. The estimation strategy we propose is similar to the strategy employed to estimate Real Business Cycle (RBC) models. In the present case, as in RBC studies, the model to be estimated is nonlinear in parameters. We employ a GMM estimation using Newey and West (1987) weighting matrices. The estimated structural parameters for the two economies fall into a reasonable range. The results permit us to interpret the contribution of public capital and government borrowing to economic growth and the different growth experiences of the American and German economies in the post-war period. Moreover, our methodology allows us to also explore the sustainability of public debt for the U.S. as well as Germany.

Download or read book Public Debt and Aggregate Stability with Endogenous Growth and a State dependent Consumption Tax written by Alfred Greiner and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: