The future of public debt: prospects and implications
AbstractSince the start of the financial crisis, industrial country public debt levels have increased dramatically. And they are set to continue rising for the foreseeable future. A number of countries face the prospect of large and rising future costs related to the ageing of their populations. In this paper, we examine what current fiscal policy and expected future age-related spending imply for the path of debt/GDP ratios over the next several decades. Our projections of public debt ratios lead us to conclude that the path pursued by fiscal authorities in a number of industrial countries is unsustainable. Drastic measures are necessary to check the rapid growth of current and future liabilities of governments and reduce their adverse consequences for long-term growth and monetary stability.
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Bibliographic InfoPaper provided by Bank for International Settlements in its series BIS Working Papers with number 300.
Length: 26 pages
Date of creation: Mar 2010
Date of revision:
public debt; fiscal deficit; age-related spending; inflation; interest rates; default risk;
This paper has been announced in the following NEP Reports:
- NEP-AGE-2010-04-11 (Economics of Ageing)
- NEP-ALL-2010-04-11 (All new papers)
- NEP-CBA-2010-04-11 (Central Banking)
- NEP-PBE-2010-04-11 (Public Economics)
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Verschuldung und Demographie: Wann werden Staatsanleihen toxisch?
by admin in BATZ.ch on 2010-05-15 09:51:30
- Le vieillissement de la population et l'explosion future des dettes publiques
by firstname.lastname@example.org (Le Captain') in Captain Economics on 2012-09-18 14:14:12
- DÃ©pendance et vieillissement: la dette de la France pourrait atteindre 400% du PIB !
by email@example.com (Captain Economics) in Economie Matin on 2012-09-19 10:29:52
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