PUBLIC DEBT IN A POLITICAL ECONOMY

2016 ◽  
Vol 20 (5) ◽  
pp. 1282-1312 ◽  
Author(s):  
Sigrid Röhrs
Keyword(s):  
Political Economy ◽  
Public Debt ◽  
Economic Model ◽  
Private Consumption ◽  
Overlapping Generations ◽  
Elasticity Of Substitution ◽  
Future Generations ◽  
Public And Private ◽  
Optimal Policies

This paper analyzes the determination of public debt in a dynamic politico-economic model with overlapping generations. Sizeable levels of public debt can be rationalized in this model. The elasticity of substitution between public and private consumption determines the size of public debt and could explain differences of debt across countries. I compare the optimal policies under commitment and in a “political equilibrium” without commitment. Public debt can be higher or lower when commitment is absent, depending on the elasticity of substitution between public and private consumption. Consequently, under certain conditions, the no-commitment debt level can be closer to a normative benchmark with higher weight for future generations.

scholarly journals Does the Ricardian Equivalence Theorem Capture the Consumption Behavior of Maltese Households?

2018 ◽  
Vol 10 (12) ◽  
pp. 77
Author(s):  
Ian P. Cassar ◽  
Kurt Davison ◽  
Christian Xuereb
Keyword(s):  
Open Economy ◽  
Public Debt ◽  
Private Consumption ◽  
Household Consumption ◽  
Equivalence Theorem ◽  
Future Generations ◽  
Consumption Pattern ◽  
Ricardian Equivalence ◽  
Consumption Behavior ◽  
High Level

This paper explores the relationship between government debt and private consumption for Malta. In particular, it attempts to find evidence in favor or against the proposition that the consumption behavior of Maltese households follows the Ricardian Equivalence Theorem. The empirical findings from this analysis suggest that household consumption behavior in Malta is not Ricardian. The resulting lack of evidence supporting the presence of a cointegrating relationship between private consumption and public debt indicates that there is no long run relationship amongst these two variables. However, the results obtained from a subsequent application of a vector auto regressive generalized impulse response function suggests that in the short-term a rise in public debt does positively influence private household consumption. This implies that Keynesian theory may be better suited at explaining the underlying behavior of Maltese households in response to changes in the level of public debt, supporting the view that Maltese households, on aggregate, exhibit a myopic behavior with regards to household consumption patterns. This suggests that to an extent, the Government may thus be able to take advantage of the implicit effectiveness of an expansionary fiscal stance to stimulate the economy through higher aggregate consumption, at least in the short run. However, it should be noted that in the case of Malta the non-presence of the Ricardian Equivalence Theorem may not necessarily imply a high level of effectiveness of Keynesian fiscal policy, given that Malta is a small and open economy characterized by a high level of import content in its aggregate demand components. The longer-term implications pertaining to the public debt burden on future generations should be taken into account by policy makers as higher levels of debt could result in an eventual contractionary fiscal stance, which would negatively impact the consumption pattern of future generations.

scholarly journals Evaluating Changes in the Transmission Mechanism of Government Spending Shocks

2020 ◽  
Vol 0 (0) ◽  
Author(s):  
Nooman Rebei
Keyword(s):  
Government Spending ◽  
Private Consumption ◽  
Public Spending ◽  
Transmission Mechanism ◽  
Elasticity Of Substitution ◽  
Public And Private ◽  
Elasticity Of Intertemporal Substitution ◽  
Public Consumption ◽  
Private And Public ◽  
Rolling Windows

AbstractWe empirically revisit the crowding-in effect of government spending on private consumption based on rolling windows of U.S. data. Results show that in earlier samples government spending is increasingly crowding in private consumption; however, this relation is reverted in the latest periods. We propose a model embedding non-separable public and private consumption in the utility function and rule-of-thumb consumers to assess the sources of non-monotonic changes in the transmission of the shock. The iterative full information estimation of the model reveals that changes in the co-movement between private and public spending is primarily driven by the fluctuations in the elasticity of substitution between private and public consumption, the share of financially constrained consumers, and the elasticity of intertemporal substitution.

Public and Private Net Savings in Developing Countries: Some Empirical Tests for the Period 1972-88 (Distinguishedl Lecture)

1992 ◽  
Vol 31 (4I) ◽  
pp. 431-447
Author(s):  
Peter A. Cornelisse ◽  
Elma Van De Mortel
Keyword(s):  
Public Debt ◽  
World Economy ◽  
Socioeconomic Development ◽  
Critical Size ◽  
Public And Private ◽  
Critical Dimensions ◽  
The Public ◽  
Empirical Tests ◽  
Financial Issues

The severe shocks that rocked the world economy in the 1970s and the ensuing efforts to adjust and to renew economic growth have had a profound effect on the economic literature. Especially the external and public debt problems which reached critical dimensions in many countries attracted much attention. Thus, in the field of macroeconomics financial issues have gained more prominence over the last two decades. Studies relating to the fiscal deficit have been particularly numerous. The critical size of national public debts, the contribution of the public debt to external debt, the reduced confidence in the state as the guide in socioeconomic development and the role of fiscal policy in adjustment processes are among the main reasons for this increased interest.

Sobre la función de los montes y su planificación

2014 ◽  
pp. 1833-1841
Author(s):  
Mikel Mari KARRERA EGIALDE
Keyword(s):  
Natural Resource ◽  
Economic Value ◽  
Forest Policy ◽  
Future Generations ◽  
Public And Private ◽  
The Public ◽  
Sustainability Criteria ◽  
Territorial Planning ◽  
The Future

LABURPENA: Gaur egun, mendien kudeaketa eta baso-politika ingurumeneko eta jasangarritasuneko irizpideetan oinarritzen dira, eta lurraldeko baliabide natural nagusiaren aprobetxamenduari buruzko erabakiak bideratzen dituzte. Hori dela-eta, lurralde-antolamendu ororen markoan, nekazaritzaren, basogintzaren eta abeltzaintzaren arloan jarduten duten eragile publiko eta pribatu guztiek egindako plangintza oinarrizkoa izango da hurrengoa bermatzeko: egun mendia behar bezala aprobetxatuz etorkizuneko belaunaldiei balio sozial eta ekonomiko bera transmititzen dien kudeaketa. RESUMEN: La gestión de los montes y la política forestal se fundamentan, actualmente, en criterios medioambientales y de sostenibilidad que dirigen las decisiones sobre el aprovechamiento del principal recurso natural del territorio. Por ello, en el marco de toda ordenación territorial, la planificación mediante la participación de todos los agentes públicos y privados que operan en el ámbito agrosilvopastoral se erige en instrumento esencial de las orientaciones garantizadoras de una gestión que, aprovechando óptimamente el monte en el presente, transmita ese mismo valor social y económico a las futuras generaciones. ABSTRACT: The management of forests and the forest policy are presently based on enviromental and sustainability criteria which are addressed to the decisions regarding the exploitation of the main natural resource of the territory. Because of it, in the framework of the whole territorial planning, the planning by the participation of all the public and private agents that operate within the agrarian, forest and herding field becomes an essential instrument of the guidelines that guaratee the management which using ideally the forest nowadays give that same social and economic value to the future generations.

scholarly journals Public Service Employee Motivation Issues in Georgia

2018 ◽  
Vol 4 (1) ◽  
pp. 49-55
Author(s):  
Salome Sakvarelidze
Keyword(s):  
Public Service ◽  
Employee Motivation ◽  
Modern Human ◽  
Public And Private ◽  
Service Employees ◽  
Essential Condition ◽  
The Public ◽  
Public Managers ◽  
Public And Private Sector

Abstract The motivated employee represents the essential condition of any organization’s success. Public and private sector managers should constantly work toward coordinating and increasing employee motivation in order to ensure the timely and effective implementation of the plans set by the organization. Accordingly, proper assessment of processes and prompt determination of individuals’ driving motives are needed. Studies have shown that public service employees from all around the world face challenges, such as: incompatibility of knowledge, experience and position, as well as hard and lightweight work. Consequently, public managers should be aware of modern human resource management methods that can be used in effective and efficient ways to increase employee work quality. The main purpose of the paper is to determine the current situation of the public sector in Georgia. In addition, the research seeks to identify and examine the factors that influence employee demotivation and to determine under what conditions motivation can be a worthwhile investment in a public organizations. Methodologically, the work is based on analysis of the available literature and the results of the research statistically processed based on the survey example of 449 respondents from different Georgian ministries selected by a random simple.

scholarly journals State and Private Archives: Construction of the System of Relations and Opportunities of Cooperation

Atlanti ◽  
2018 ◽  
Vol 28 (1) ◽  
pp. 229-237
Author(s):  
Andrei Rybakou
Keyword(s):  
Future Generations ◽  
Archival Science ◽  
Optimal Solutions ◽  
Public And Private ◽  
Private Organizations ◽  
Permanent Storage ◽  
State Archives ◽  
The Relationship

The article is devoted to the search for optimal solutions for building the relationship between public and private archives. The author acknowledges that the documents formed in the activities of private organizations have value and are subject to permanent storage for future generations. However, it is impossible to keep all the documentation, therefore, when selecting documents for permanent storage, it is necessary to take into account the principles and criteria for disposal developed by archival science, to apply them in a complex and creatively. When organizing work with private archives and accepting their documents in state archives, it is necessary to proceed from the property of the documents and, depending on the established legal relations and the value of documents of specific organizations, apply different approaches.

scholarly journals On the Substitution of Private and Public Capital in Production

2019 ◽  
Vol 19 (232) ◽  
Author(s):  
Zidong An ◽  
Alvar Kangur ◽  
Chris Papageorgiou
Keyword(s):  
Production Function ◽  
Public Capital ◽  
Physical Capital ◽  
Elasticity Of Substitution ◽  
Point Estimate ◽  
Private Capital ◽  
Public And Private ◽  
Macroeconomic Models ◽  
Private And Public ◽  
Penn World Table

Most macroeconomic models assume that aggregate output is generated by a specification for the production function with total physical capital as a key input. Implicitly this assumes that private and public capital stocks are perfect substitutes. In this paper we test this assumption by estimating a nested-CES production function whereas the two types of capital are considered separately along with labor as inputs. The estimation is based on our newly developed dataset on public and private capital stocks for 151 countries over a period of 1960-2014 consistent with Penn World Table version 9. We find evidence against perfect substitutability between public and private capital, especially for emerging and LIDCs, with the point estimate of the elasticity of substitution estimated closely around 3.

scholarly journals Economic Growth, Public and Private Consumption in Cameroon: A Multivariate Analysis

2018 ◽  
Vol 11 (1) ◽  
pp. 26
Author(s):  
Honoré Samuel NTAVOUA
Keyword(s):  
Economic Growth ◽  
Multivariate Analysis ◽  
Empirical Research ◽  
Private Consumption ◽  
Causal Link ◽  
Vector Model ◽  
Public And Private ◽  
Public Consumption ◽  
The Relationship

<p>The nature of the link between economic growth, public and private consumption in theoretical and empirical research is not well known in Cameroon. The objective of this study is to examine the nature of the relationship between economic growth, public and private consumption in Cameroon from 1980 to 2015. In order to achieve our goal, the data from the CENUCED were collected and tested in the autoregressive vector model (VAR). The delay selection statistic for VAR allowed us to have the following causality results: in Cameroon, there is a unidirectional relationship between economic growth towards public consumption and economic growth towards private consumption. Meanwhile, there is no causal link between public and private consumption, from public and private consumption to economic growth. Thus, the recommendation is that the Cameroonian government should create an incentive framework conducive to the improvement of public and private consumption to stimulate investment and economic growth.</p>

Public debt and private consumption in OECD countries

2014 ◽  
Vol 11 ◽  
pp. 1-7 ◽  
Author(s):  
Periklis Gogas ◽  
Vasilios Plakandaras ◽  
Theophilos Papadimitriou
Keyword(s):  
Public Debt ◽  
Private Consumption ◽  
Oecd Countries
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