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Staatsverschuldung und Verschuldungsmentalität
[Public Debt and Debt Mentality]

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  • Dilla, Diana

Abstract

In search for determinants of public debt, traditional economic approaches use macroeconomic and public choice models. More recent research explains public debt by debt preferences of voters and politicians. When it comes to empirical testing, however, the latter approach often suffers from the lack of suitable proxies for debt preferences. The present paper finds a remedy by using private debt as a proxy for voters’ debt mentality. The empirical analysis employs a panel data set for the German Laender and reveals that both private debt and private over-indebtedness have a significantly positive impact on public debt.

Suggested Citation

  • Dilla, Diana, 2017. "Staatsverschuldung und Verschuldungsmentalität [Public Debt and Debt Mentality]," MPRA Paper 79432, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:79432
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    More about this item

    Keywords

    Public debt; debt preferences; private debt mentality; private debt; private overindebtedness;
    All these keywords.

    JEL classification:

    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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