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Do large industrialized economies pursue sustainable debt policies? A comparative study for Japan, Germany and the United States

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  • Fincke, Bettina
  • Greiner, Alfred

Abstract

This paper analyzes the public debt situation in Japan, Germany and the United States by reflecting their respective debt history and by analyzing whether the governments pursue a sustainable debt policy. Starting point of the analysis are theoretical considerations about conditions guaranteeing sustainability of public debt. In the empirical estimations we allow for time-varying parameters to take into account changing government policies. The findings allow to conclude that for all selected countries there is evidence of sustainability of public debt although country specific characteristics of public finances need to be considered.

Suggested Citation

  • Fincke, Bettina & Greiner, Alfred, 2011. "Do large industrialized economies pursue sustainable debt policies? A comparative study for Japan, Germany and the United States," Japan and the World Economy, Elsevier, vol. 23(3), pages 202-213.
  • Handle: RePEc:eee:japwor:v:23:y:2011:i:3:p:202-213
    DOI: 10.1016/j.japwor.2011.03.002
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Alfred Greiner, 2015. "Fiscal and Monetary Policy in a Basic Endogenous Growth Model," Computational Economics, Springer;Society for Computational Economics, vol. 45(2), pages 285-301, February.
    2. Paniagua, Jordi & Sapena, Juan & Tamarit, Cecilio, 2017. "Fiscal sustainability in EMU countries: A continued fiscal commitment?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 50(C), pages 85-97.
    3. Atsumasa Kondo, 2016. "Sustainability of Public Debt in an AK Model with Complex Tax System," Discussion Papers CRR Discussion Paper Series A: General 21, Shiga University, Faculty of Economics,Center for Risk Research.
    4. Burret Heiko T. & Köhler Ekkehard A. & Feld Lars P., 2013. "Sustainability of Public Debt in Germany – Historical Considerations and Time Series Evidence," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 233(3), pages 291-335, June.
    5. Alfred Greiner, 2015. "Public Debt, Productive Public Spending and Endogenous Growth," The Japanese Economic Review, Japanese Economic Association, vol. 66(4), pages 520-535, December.
    6. Evan Lau & Ahmad Zubaidi Baharumshah & Soon, 2013. "The behavior of external debt in Asian countries: evidence based on panel unit root tests," Journal of Business Economics and Management, Taylor & Francis Journals, vol. 14(sup1), pages 377-394, June.
    7. Bettina Fincke & Alfred Greiner, 2016. "On the relation between public debt and economic growth: an empirical investigation," Economics and Business Letters, Oviedo University Press, vol. 4(4), pages 137-150.
    8. Katia Berti & Eugeniu Colesnic & Cyril Desponts & Stephanie Pamies & Etienne Sail, 2016. "Fiscal Reaction Functions for European Union Countries," European Economy - Discussion Papers 2015 - 028, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.

    More about this item

    Keywords

    Public debt; Inter-temporal budget constraint; Penalized spline estimation;

    JEL classification:

    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy

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