IDEAS home Printed from https://ideas.repec.org/a/cup/jnlpup/v8y1988i01p49-60_00.html
   My bibliography  Save this article

Budget Deficits, Inflation Accounting, and Macroeconomic Policy: A Skeptical Note

Author

Listed:
  • Catsambas, Thanos

Abstract

This paper challenges the mechanical application of inflation accounting to public sector deficits as it has been suggested in recent years. Although the theoretical considerations underlying the proposed adjustment for the inflation premium of interest payments are well taken, the new approach has fundamentally focused on measurement issues with little attention paid to the behavioral aspects of microeconomic adjustment. This paper, therefore, raises skepticism about the usefulness of inflation accounting, if such a correction is not accompanied by a conceptual model that links behavioral responses of individuals to balance sheets and other stock variables. In a departure from previous investigations, the paper also points out the possibility that inflation accounting might have more relevant implications for public, rather than private, spending.

Suggested Citation

  • Catsambas, Thanos, 1988. "Budget Deficits, Inflation Accounting, and Macroeconomic Policy: A Skeptical Note," Journal of Public Policy, Cambridge University Press, vol. 8(1), pages 49-60, January.
    • Handle: RePEc:cup:jnlpup:v:8:y:1988:i:01:p:49-60_00
    as

    Download full text from publisher

    File URL: https://www.cambridge.org/core/product/identifier/S0143814X0000684X/type/journal_article
    File Function: link to article abstract page
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jakob De Haan & Jan Egbert Sturm, 1995. "Is it real? The relationship between real deficits and real growth: new evidence using long-run data," Applied Economics Letters, Taylor & Francis Journals, vol. 2(4), pages 98-102.
    2. Catsambas, Thanos, 1993. "Public output and private decisions : conceptual issues in the evaluation of Government activities and their implications for fiscal policy," Policy Research Working Paper Series 1108, The World Bank.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cup:jnlpup:v:8:y:1988:i:01:p:49-60_00. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kirk Stebbing (email available below). General contact details of provider: https://www.cambridge.org/pup .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.