The Sovereign Debt Crisis: Placing a curb on growth
AbstractTo ward off the threat of a worldwide depression that loomed at the end of the 2000s, governments opted to run up substantial fiscal deficits. In doing so, they sowed the seeds of the sovereign debt crisis. Saddled with often high debt burdens and modest growth prospects, developed countries’ governments must now rebalance their budgets. Doing so too rapidly, however, will choke growth. Faced with this dilemma, Japan and the United States have pursued growth policies while the euro area members are quickly trying to rebalance their budgets. This book explores the respective risks associated with these two strategies. It further investigates the consequences for the international monetary and financial system of developing countries’ public debts ceasing to be risk-free.
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Bibliographic InfoPaper provided by Centre for European Policy Studies in its series CEPS Papers with number 6951.
Length: 8 pages
Date of creation: May 2012
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-01 (All new papers)
- NEP-EEC-2012-07-01 (European Economics)
- NEP-PBE-2012-07-01 (Public Economics)
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