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Post-Pandemic Evolution of Public Debt in European States

Author

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  • Olteanu, Dan Constantin

    (Romanian Academy, National Institute of Economic Research)

Abstract

This study provides a comparative analysis, for the European countries, of how the volume and structure of public debt have evolved during the pandemic and in the following years. We will study the trend of public debt share in government revenues, the dynamics of public debt structure by financial instruments and maturity, the evolution of external and foreign currency public debt, the interest expenditures and the apparent cost of debt. The analyses show a substantial accumulation of debt in the EU27, with an average rate of over 6% in the period 2020-2023. Romania's public debt increased, in nominal terms, more than double between 2019 and 2023. The slope of the debt trend in Romania (rate of over 17% in 2022-2023) is worrying and its perpetuation over the next few years would put pressure, through debt service, on public spending that is already oversized in relation to revenues.

Suggested Citation

  • Olteanu, Dan Constantin, 2024. "Post-Pandemic Evolution of Public Debt in European States," Working Papers of National Institute for Economic Research 241217, Institutul National de Cercetari Economice (INCE).
    • Handle: RePEc:ror:wpince:241217
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    References listed on IDEAS

    as
    1. Grégory Claeys & Conor McCaffrey & Lennard Welslau, 2023. "The rising cost of European Union borrowing and what to do about it," Bruegel Policy Brief node_9089, Bruegel.
    2. Catao, Luis A.V. & Terrones, Marco E., 2005. "Fiscal deficits and inflation," Journal of Monetary Economics, Elsevier, vol. 52(3), pages 529-554, April.
    3. Abebe Aragaw, 2024. "The inflationary effect of the budget deficit: does financial sector development matter?," Journal of Innovation and Entrepreneurship, Springer, vol. 13(1), pages 1-15, December.
    4. Saioa Armendariz & Ezequiel Cabezon & Mr. Larry Q Cui & Silvia Domit & Alina Iancu & Giacomo Magistretti & Rohan Srinivas & Yu Ching Wong, 2024. "Taming Public Debt in Europe: Outlook, Challenges, and Policy Response," IMF Working Papers 2024/181, International Monetary Fund.
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    More about this item

    Keywords

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    JEL classification:

    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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