This contribution summarizes insights as regards the effects of public debt in the form of a treatise.
这篇论文以专著的形式总结了有关公共债务影响的见解。
{"title":"Treatise on Public Debt","authors":"Alfred Greiner","doi":"10.2139/SSRN.2990238","DOIUrl":"https://doi.org/10.2139/SSRN.2990238","url":null,"abstract":"This contribution summarizes insights as regards the effects of public debt in \u0000the form of a treatise.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"30 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-06-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132157472","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The main aim of this study is to analyze the evolution of public debts and general government deficits/surplus across European countries within and outside the monetary unification. In particular, this study compares the dynamics of public debts and general government deficits between European countries within and outside the monetary unification for the preceding and subsequent period the introduction of the Euro currency. Statistical analyses show that the evolution of public debts is significantly different between European countries. Nations within the European monetary unification seem to have, from 2001 onwards, a deteriorated sovereign debts and general government deficits in comparison to countries outside the European monetary unification. This dissimilar evolution of public debts and general government deficits between European countries can be due to manifold factors. Moreover, these asymmetric paths of public debts and general government deficits across European countries may be one of contributing factors that generates uncertain scenarios and negative socioeconomic effects on patterns of growth of the overall European Union economy.
{"title":"The Deteriorating Dynamics of Public Debts Across Countries within the European Monetary Unification in Comparison with Countries Outside the European Monetary","authors":"M. Coccia","doi":"10.2139/ssrn.2957949","DOIUrl":"https://doi.org/10.2139/ssrn.2957949","url":null,"abstract":"The main aim of this study is to analyze the evolution of public debts and general government deficits/surplus across European countries within and outside the monetary unification. In particular, this study compares the dynamics of public debts and general government deficits between European countries within and outside the monetary unification for the preceding and subsequent period the introduction of the Euro currency. Statistical analyses show that the evolution of public debts is significantly different between European countries. Nations within the European monetary unification seem to have, from 2001 onwards, a deteriorated sovereign debts and general government deficits in comparison to countries outside the European monetary unification. This dissimilar evolution of public debts and general government deficits between European countries can be due to manifold factors. Moreover, these asymmetric paths of public debts and general government deficits across European countries may be one of contributing factors that generates uncertain scenarios and negative socioeconomic effects on patterns of growth of the overall European Union economy.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-04-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132798716","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The objective of this paper is to examine whether the threshold beyond which a public debt change may have a detrimental effect on economic growth changes across euro area countries during the 1961–2015 period. In contrast with previous studies, we do not use panel estimation techniques, but implement a time-series analysis for each country based on the growth literature. The results suggest that in all the countries but Belgium a debt increase begins to have detrimental effects on growth well before the SGP debt ceiling (a debt ratio of around 40% and 50% in central and peripheral countries, respectively) is reached. So, although austerity policies should be applied in EMU countries – since according to our results debt reduction barely exerts any significant beneficial impact on EMU countries' growth – they should be accompanied by structural reforms that can increase their potential GDP. Moreover, as our results suggest that the harmful impact of a debt change on growth does not occur beyond the same threshold and with the same intensity in all EMU countries, a focus on average ratios and impacts may be unsuitable for defining policies. Specifically, our findings suggest that the pace of fiscal adjustment should be lower in Greece and Spain than in the other countries.
{"title":"Heterogeneity in the Debt-Growth Nexus: Evidence from EMU Countries","authors":"Marta Gómez-Puig, S. Sosvilla‐Rivero","doi":"10.2139/ssrn.2943255","DOIUrl":"https://doi.org/10.2139/ssrn.2943255","url":null,"abstract":"The objective of this paper is to examine whether the threshold beyond which a public debt change may have a detrimental effect on economic growth changes across euro area countries during the 1961–2015 period. In contrast with previous studies, we do not use panel estimation techniques, but implement a time-series analysis for each country based on the growth literature. The results suggest that in all the countries but Belgium a debt increase begins to have detrimental effects on growth well before the SGP debt ceiling (a debt ratio of around 40% and 50% in central and peripheral countries, respectively) is reached. So, although austerity policies should be applied in EMU countries – since according to our results debt reduction barely exerts any significant beneficial impact on EMU countries' growth – they should be accompanied by structural reforms that can increase their potential GDP. Moreover, as our results suggest that the harmful impact of a debt change on growth does not occur beyond the same threshold and with the same intensity in all EMU countries, a focus on average ratios and impacts may be unsuitable for defining policies. Specifically, our findings suggest that the pace of fiscal adjustment should be lower in Greece and Spain than in the other countries.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-03-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133693547","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2017-03-01DOI: 10.5089/9781475588170.001
M. Bernardini, L. Forni
Using a dataset covering a large sample of emerging economies (EMEs), we study the relationship between debt and economic performance in bad times. While previous research has shown that private debt buildups exacerbate the duration and intensity of recessions in advanced economies (AEs), we document that this effect is very pronounced in EMEs as well. Moreover, although rapid public debt buildups are unlikely to be the primary trigger of financial crises, in EMEs they are associated with deeper and longer recessions than in AEs. Part of this difference is explained by a less supportive fiscal policy in EMEs during crises.
{"title":"Private and Public Debt: Are Emerging Markets at Risk?","authors":"M. Bernardini, L. Forni","doi":"10.5089/9781475588170.001","DOIUrl":"https://doi.org/10.5089/9781475588170.001","url":null,"abstract":"Using a dataset covering a large sample of emerging economies (EMEs), we study the relationship between debt and economic performance in bad times. While previous research has shown that private debt buildups exacerbate the duration and intensity of recessions in advanced economies (AEs), we document that this effect is very pronounced in EMEs as well. Moreover, although rapid public debt buildups are unlikely to be the primary trigger of financial crises, in EMEs they are associated with deeper and longer recessions than in AEs. Part of this difference is explained by a less supportive fiscal policy in EMEs during crises.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"6 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130587844","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
• The exit consent technique refers to an offer by a bond issuer to all the bondholders to exchange the existing bonds for new bonds or other types of securities, on the condition that the tendering bondholders must consent to a resolution which will amend the terms of the existing bonds so as to make the bonds less attractive. • In Marblegate and Caesars, the US District Court for the Southern District of New York held that the relevant exit consent in each case violated Section 316(b) of the Trust Indenture Act of 1939 (US) on the basis that Section 316(b) prohibits not only impairment of a dissenting bondholder’s formal right to payment, but also ‘practical impairment’ of such right. This article argues that there is no sufficient justification for giving Section 316(b) a broader interpretation than its plain language suggests. Such an interpretation is inconsistent with the legislative history of Section 316(b) and how the term ‘impairment of a right’ is used in other contexts. In January 2017, in a 2:1 decision, the US Court of Appeals for the Second Circuit reversed the district court’s ruling in Marblegate, holding that Section 316(b) only prohibits non-consensual amendments to an indenture’s core payment terms. • In Assenagon, the UK High Court held that the exit consent arrangement in that case was unlawful because it breached the abuse principle under English law. This article argues that the application of the abuse principle in exit consent cases should be considered in light of the factual context and the parties’ presumed intention. It is difficult to see how a consenting bondholder abuses its power when it is simply making a rational choice. Furthermore, it cannot possibly be the parties’ presumed intention that, when the issuer has made an exchange offer coupled with an exit consent, the consenting bondholder is required to prioritise the interests of the dissenting bondholders over its own interest.
{"title":"Exit Consents in Debt Restructurings","authors":"Benjamin Liu","doi":"10.2139/SSRN.2916453","DOIUrl":"https://doi.org/10.2139/SSRN.2916453","url":null,"abstract":"• The exit consent technique refers to an offer by a bond issuer to all the bondholders to exchange the existing bonds for new bonds or other types of securities, on the condition that the tendering bondholders must consent to a resolution which will amend the terms of the existing bonds so as to make the bonds less attractive. \u0000• In Marblegate and Caesars, the US District Court for the Southern District of New York held that the relevant exit consent in each case violated Section 316(b) of the Trust Indenture Act of 1939 (US) on the basis that Section 316(b) prohibits not only impairment of a dissenting bondholder’s formal right to payment, but also ‘practical impairment’ of such right. This article argues that there is no sufficient justification for giving Section 316(b) a broader interpretation than its plain language suggests. Such an interpretation is inconsistent with the legislative history of Section 316(b) and how the term ‘impairment of a right’ is used in other contexts. In January 2017, in a 2:1 decision, the US Court of Appeals for the Second Circuit reversed the district court’s ruling in Marblegate, holding that Section 316(b) only prohibits non-consensual amendments to an indenture’s core payment terms. \u0000• In Assenagon, the UK High Court held that the exit consent arrangement in that case was unlawful because it breached the abuse principle under English law. This article argues that the application of the abuse principle in exit consent cases should be considered in light of the factual context and the parties’ presumed intention. It is difficult to see how a consenting bondholder abuses its power when it is simply making a rational choice. Furthermore, it cannot possibly be the parties’ presumed intention that, when the issuer has made an exchange offer coupled with an exit consent, the consenting bondholder is required to prioritise the interests of the dissenting bondholders over its own interest.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"2 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-02-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132147799","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper aims to address the role of subordinated liabilities within the new resolution framework resulting from the post-crisis reforms. In particular, this study starts from the resolution intervention of four Italian banks in November 2015. The legal analysis of that resolution is complemented by an empirical analysis of the determinants of subordinated debt issuances for Italian banks. From this set of evidence is possible to infer the desirability of a well-functioning and dynamic market for subordinated debt. On the other hand, what clearly emerges is the incompatibility between such a market and the new regulatory framework as it is. Therefore, the paper, given the compelling arguments showing the inefficiency of a pure mandatory bail-in mechanism for subordinated debt, proposes to complement it with a contractual clause to bail-in subordinated creditors, tailored on coco bonds model, in order to enhance certainty amongst the contractual parties.
{"title":"Subordinated Debt Under Bail-in Threat","authors":"Edoardo D. Martino","doi":"10.2139/ssrn.2902134","DOIUrl":"https://doi.org/10.2139/ssrn.2902134","url":null,"abstract":"This paper aims to address the role of subordinated liabilities within the new resolution framework resulting from the post-crisis reforms. In particular, this study starts from the resolution intervention of four Italian banks in November 2015. The legal analysis of that resolution is complemented by an empirical analysis of the determinants of subordinated debt issuances for Italian banks. From this set of evidence is possible to infer the desirability of a well-functioning and dynamic market for subordinated debt. On the other hand, what clearly emerges is the incompatibility between such a market and the new regulatory framework as it is. Therefore, the paper, given the compelling arguments showing the inefficiency of a pure mandatory bail-in mechanism for subordinated debt, proposes to complement it with a contractual clause to bail-in subordinated creditors, tailored on coco bonds model, in order to enhance certainty amongst the contractual parties.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"6 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-01-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123822215","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
What does it mean for public financial managers to be professionally and democratically accountable in managing public debt? How do they accomplish (or fall short of) accountability? What are the results of their accountability (or lack thereof)? This paper develops an analytic framework for mapping the accountability space within which public financial managers work to reconcile diverse normative expectations as they exercise discretionary judgment and choice in the area of public-debt management specifically. An accountability framework offers the possibility of connecting previous literature's focus on micro-level decision making and social psychology on the one hand, and macro-level normative guidance offered by public-choice theorists and public-finance economists on the other hand, by focusing on the interactions of macro- and meso-level norms and expectations with micro-level decision processes, judgment and choice.The framework is meant to provide a structure for understanding in empirical settings how state and local government financial managers' professional, democratic, and other accountabilities interact with each other and with other expressed and implied expectations of relevant stakeholders. It is intended to serve as a basis for conducting empirical research to understand how actual debt-management decisions and behavior respond (or fail to respond) to those various norms, and with what results. An additional, normative goal is to contribute to the development of means by which public administrators can understand and manage the conflict between espoused public preferences for thrift and implied and acted-upon preferences for profligacy, by making decisions that accommodate, resolve, or transcend those dilemmas of accountability.
{"title":"Democratic Accountability for Public Debt","authors":"J. Justice","doi":"10.2139/ssrn.2913198","DOIUrl":"https://doi.org/10.2139/ssrn.2913198","url":null,"abstract":"What does it mean for public financial managers to be professionally and democratically accountable in managing public debt? How do they accomplish (or fall short of) accountability? What are the results of their accountability (or lack thereof)? This paper develops an analytic framework for mapping the accountability space within which public financial managers work to reconcile diverse normative expectations as they exercise discretionary judgment and choice in the area of public-debt management specifically. An accountability framework offers the possibility of connecting previous literature's focus on micro-level decision making and social psychology on the one hand, and macro-level normative guidance offered by public-choice theorists and public-finance economists on the other hand, by focusing on the interactions of macro- and meso-level norms and expectations with micro-level decision processes, judgment and choice.The framework is meant to provide a structure for understanding in empirical settings how state and local government financial managers' professional, democratic, and other accountabilities interact with each other and with other expressed and implied expectations of relevant stakeholders. It is intended to serve as a basis for conducting empirical research to understand how actual debt-management decisions and behavior respond (or fail to respond) to those various norms, and with what results. An additional, normative goal is to contribute to the development of means by which public administrators can understand and manage the conflict between espoused public preferences for thrift and implied and acted-upon preferences for profligacy, by making decisions that accommodate, resolve, or transcend those dilemmas of accountability.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"235 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-01-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122099994","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
As public debt rises, governments struggle to fund and finance new infrastructure. The past two decades have seen an increase in privatization of infrastructure assets and public private partnerships. However, alignment of interests between governments and private owners can be challenging. In addition, private investors’ appetite has so far been skewed toward existing assets, while development requires new infrastructure. The literature about the role of the state in development also warns about a failure of the private sector to fulfill governments’ development goals, and the need for a strong State to regulate the market in order to achieve development. A case study of the creation of a new coordination agency in New South Wales (NSW), Australia, offers a new perspective on how governments can lead development. Contrary to Evans’ model of Developmental Bureaucracy, NSW created an agency staffed by employees from the private sector. They also focused on making the best use of private interests to indirectly serve developmental goals, instead silencing private interests by means of a strong bureaucratic culture. The connections between public and private sectors are reminiscent of O’Riain’s Flexible State. However, this case transposes this theory to the strategic fields of private versus public sectors instead of local versus global. Finally, the power given to the coordinating agency is also crucial in this case, but we argue that government is an institution in Scott’s sense, and that normative and cultural-cognitive elements are also crucial in explaining the success of NSW in addition to regulative aspects identified in previous studies. This case study supports a new theory of developmental state which we call the “financier state”, in which Government uses the tools of global financial markets to achieve developmental goals. We describe “asset recycling” as one of such tools, successfully used by NSW to develop infrastructure.
{"title":"The Financier State as an Alternative to The Developmental State: A Case Study of Infrastructure Asset Recycling in New South Wales, Australia","authors":"C. Nowacki, R. Levitt, Ashby H. B. Monk","doi":"10.2139/ssrn.2860264","DOIUrl":"https://doi.org/10.2139/ssrn.2860264","url":null,"abstract":"As public debt rises, governments struggle to fund and finance new infrastructure. The past two decades have seen an increase in privatization of infrastructure assets and public private partnerships. However, alignment of interests between governments and private owners can be challenging. In addition, private investors’ appetite has so far been skewed toward existing assets, while development requires new infrastructure. The literature about the role of the state in development also warns about a failure of the private sector to fulfill governments’ development goals, and the need for a strong State to regulate the market in order to achieve development. A case study of the creation of a new coordination agency in New South Wales (NSW), Australia, offers a new perspective on how governments can lead development. Contrary to Evans’ model of Developmental Bureaucracy, NSW created an agency staffed by employees from the private sector. They also focused on making the best use of private interests to indirectly serve developmental goals, instead silencing private interests by means of a strong bureaucratic culture. The connections between public and private sectors are reminiscent of O’Riain’s Flexible State. However, this case transposes this theory to the strategic fields of private versus public sectors instead of local versus global. Finally, the power given to the coordinating agency is also crucial in this case, but we argue that government is an institution in Scott’s sense, and that normative and cultural-cognitive elements are also crucial in explaining the success of NSW in addition to regulative aspects identified in previous studies. This case study supports a new theory of developmental state which we call the “financier state”, in which Government uses the tools of global financial markets to achieve developmental goals. We describe “asset recycling” as one of such tools, successfully used by NSW to develop infrastructure.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"70 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-10-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133698069","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The aim of this paper is to address the relationship between public debt and economic growth. The paper uses the PSTR model to a broad panel data set for 126 industrialized and developing countries over the period of 1964-2014. We divide the data set into four groups, namely, high income countries, upper-middle-income countries, lower middle-income and low-income countries. We have mainly addressed two aspects of this relationship: the threshold estimates for the whole sample, as well as for different sub-samples, and some country-specific characteristics that can possibly affect the degree of sensitivity between public debt and growth. Our first-stage findings confirmed those in the literature that hold that the public debt-growth relationship is nonlinear and our threshold estimates increase with the level of income.
{"title":"Public Debt and Economic Growth: New Evidence of the Non-Linearity","authors":"C. Djiogap","doi":"10.2139/ssrn.2865936","DOIUrl":"https://doi.org/10.2139/ssrn.2865936","url":null,"abstract":"The aim of this paper is to address the relationship between public debt and economic growth. The paper uses the PSTR model to a broad panel data set for 126 industrialized and developing countries over the period of 1964-2014. We divide the data set into four groups, namely, high income countries, upper-middle-income countries, lower middle-income and low-income countries. We have mainly addressed two aspects of this relationship: the threshold estimates for the whole sample, as well as for different sub-samples, and some country-specific characteristics that can possibly affect the degree of sensitivity between public debt and growth. Our first-stage findings confirmed those in the literature that hold that the public debt-growth relationship is nonlinear and our threshold estimates increase with the level of income.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"286 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-10-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116206318","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2016-10-01DOI: 10.5089/9781475545043.001.A001
Laura Jaramillo, Carlos Mulas Granados, E. Kimani
What explains public debt spikes since the end of WWII? To answer this question, this paper identifies 179 debt spike episodes from 1945 to 2014 across advanced and developing countries. We find that debt spikes are not rare events and their probability increases with time. We then show that large public debt spikes are neither driven by high primary deficits nor by output declines but instead by sizable stock-flow adjustments (SFAs). We also find that SFAs are poorly forecasted, which can affect debt sustainability analyses, and are associated with a higher probability of suffering non-declining debt paths in the aftermath of public debt spikes.
{"title":"The Blind Side of Public Debt Spikes","authors":"Laura Jaramillo, Carlos Mulas Granados, E. Kimani","doi":"10.5089/9781475545043.001.A001","DOIUrl":"https://doi.org/10.5089/9781475545043.001.A001","url":null,"abstract":"What explains public debt spikes since the end of WWII? To answer this question, this paper identifies 179 debt spike episodes from 1945 to 2014 across advanced and developing countries. We find that debt spikes are not rare events and their probability increases with time. We then show that large public debt spikes are neither driven by high primary deficits nor by output declines but instead by sizable stock-flow adjustments (SFAs). We also find that SFAs are poorly forecasted, which can affect debt sustainability analyses, and are associated with a higher probability of suffering non-declining debt paths in the aftermath of public debt spikes.","PeriodicalId":376458,"journal":{"name":"PSN: Debt (Topic)","volume":"72 3","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114210877","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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