Fiscal Sustainability: A 21st Century Guide for the Perplexed

Author/Editor:

Evan C Tanner

Publication Date:

April 22, 2013

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper critically reviews recent work regarding the sustainability of public debt. It argues that Debt Sustainability Analyses (DSAs) should be more than mere mechanical simulation exercises. Instead, a DSA should be linked to some objective regarding the distribution of fiscal burdens and distortions over time (in the tradition of Barro’s 1979 tax smoothing objective). The paper discusses objective functions that yield simple and transparent fiscal policy rules.

Series:

Working Paper No. 2013/089

Subject:

Commodities Fiscal consolidation Fiscal policy Fiscal sustainability Oil Public debt

English

Publication Date:

April 22, 2013

ISBN/ISSN:

9781484381991/1018-5941

Stock No:

WPIEA2013089

Pages:

49

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