Substantiation Of The Public Debt Sustainability Using Kalman Filter
Global economic conditions have pushed many countries into the delicate situation of contracting foreign loans, leading overnight at alarming volumes of public debt. The need for control and relevant analysis for the sustainability of a country\'s public debt has led us to use the Kalman filter in predicting future values of the key indicators of public debt. The development of a mathematical model of analysis for public services and the budget deficit was necessary to objectively assess the level of the public debt sustainability.Knowing future values of the public debt or the future evolutions of the revenues for the operational budget, offers the posibility of a better handling of the operational expenditures and finally a better balance for the public budget deficit.Using the mathematical mechanism of Kalman filters implemented in Matlab programming language, we generated the estimated future values of the proposed model proposed and key indicators, the results confirming the fears of a low public debt sustainability for Romania.We predicted the future values for the debt service, the public external debt and the operational public revenues,expenditures and deficit, and compared them, to obtain an image of the future evolution and position of the sustainability of the public debt. The work in this paper is an innovative one for the public science sector, and the results obtained are promising for future researches. The values estimated by the Kalman filter are an orientation for the future public policies, and indicate a rather stable but negative evolution for the public debt service. The sustainability of the public debt depends on the decisions taken for the correction of the estimated values, in changing the negative evolution of the budgetary indicators into a positive one.Taking all this into consideration we will conclude that the mathematical mecanism of the Kalman filters offers valuable informations for Government and future research should be oriented to develop it's returned results.
Volume (Year): 1 (2011)
Issue (Month): 2 (December)
|Contact details of provider:|| Postal: Universitatii str. 1, Office F209, 410087 Oradea, Bihor|
Fax: 004 0259 408409
Web page: http://anale.steconomiceuoradea.ro/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Barro, Robert J, 1989.
"The Ricardian Approach to Budget Deficits,"
Journal of Economic Perspectives,
American Economic Association, vol. 3(2), pages 37-54, Spring.
- Robert J. Barro, 1988. "The Ricardian Approach to Budget Deficits," Working Papers 728, Queen's University, Department of Economics.
- Robert J. Barro, 1988. "The Ricardian Approach to Budget Deficits," NBER Working Papers 2685, National Bureau of Economic Research, Inc.
- Aleksander Aristovnik, 2008. "Short-Term Determinants of Current Account Deficits: Evidence from Eastern Europe and the Former Soviet Union," Eastern European Economics, M.E. Sharpe, Inc., vol. 46(1), pages 24-42, January.
- Aleksander Aristovnik, 2008. "Short-Term Determinants of Current Account Deficits: Evidence from Eastern Europe and the Former Soviet Union," Eastern European Economics, Taylor & Francis Journals, vol. 46(1), pages 24-42, January.
- Aizenman, Joshua & Sun, Yi, 2010. "Globalization and the sustainability of large current account imbalances: Size matters," Journal of Macroeconomics, Elsevier, vol. 32(1), pages 35-44, March.
- Joshua Aizenman & Yi Sun, 2008. "Globalization and the Sustainability of Large Current Account Imbalances: Size Matters," NBER Working Papers 13734, National Bureau of Economic Research, Inc.
- Aizenman, Joshua & Sun, Yi, 2008. "Globalization and the Sustainability of Large Current Account Imbalances: Size Matters," Santa Cruz Department of Economics, Working Paper Series qt2bs193w4, Department of Economics, UC Santa Cruz.
- Aizenman, Joshua & Sun, Yi, 2009. "Globalization and the Sustainability of Large Current Account Imbalances: Size Matters," Santa Cruz Department of Economics, Working Paper Series qt4s3478nz, Department of Economics, UC Santa Cruz.
- Olivier Jean Blanchard, 1990. "Suggestions for a New Set of Fiscal Indicators," OECD Economics Department Working Papers 79, OECD Publishing. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:ora:journl:v:1:y:2011:i:2:p:323-334. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Catalin ZMOLE)
If references are entirely missing, you can add them using this form.