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Limita datoriei, spatiul fiscal si riscul oboselii fiscale in tarile Europei Centrale si de Est ale UE

Author

Listed:
  • Iancu, Aurel

    (Institutul National de Cercetari Economice al Academiei Romane)

  • Olteanu, Dan Constantin

    (Institutul National de Cercetari Economice al Academiei Romane)

Abstract

This study analyzes the correlation between the primary budget balance and the public debt during the last two decades, for a panel of 12 countries from Central and Eastern Europe, in order to assess their debt sustainability, the level of debt at which fiscal fatigue may occur, as well as the degree of risk for fiscal fatigue, depending on the past and future evolution of the public debt. First, using estimates of the cubic fiscal reaction function and two variants (quadratic / linear) of the financing cost function, we determined the equilibrium level of public debt as % of GDP, the ”fiscal fatigue” point and the debt limit, for the whole panel and each country. Second, using the common (from panel regressions) and country-specific coefficients, and public debt projection for 10 and 5 years, we evaluated the risk level of fiscal fatigue, in relation to the future evolution of the public debt and other financial indicators.

Suggested Citation

  • Iancu, Aurel & Olteanu, Dan Constantin, 2022. "Limita datoriei, spatiul fiscal si riscul oboselii fiscale in tarile Europei Centrale si de Est ale UE," Studii Economice 221215, Institutul National de Cercetari Economice (INCE).
    • Handle: RePEc:ror:seince:221215
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    More about this item

    Keywords

    primary balance; public debt; fiscal space; fiscal policy;
    All these keywords.

    JEL classification:

    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

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