Public Debt Dynamics : The Effects of Austerity, Inflation, and Growth Shocks /

We study how macroeconomic shocks affect U.S. public debt dynamics using a VAR with debt feedback. Following a fiscal austerity shock, the debt ratio initially declines and then returns to its pre-shock path. Yet, the effect is not statistically significant. In a weak economic environment, the likel...

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Bibliographic Details
Main Author: Hasanov, Fuad
Other Authors: Cherif, Reda
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2012.
Series:IMF Working Papers; Working Paper ; No. 2012/230
Online Access:Full text available on IMF