Government Deficits and Inflation in Brazil: The Experience During 1948-1964

1981 ◽  
Author(s):  
Dev Kar
Keyword(s):  
Government Deficits

Interpreting the Reagan Deficits

2017 ◽  
Author(s):  
Thomas J. Sargent
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Reagan Administration ◽  
Federal Budget ◽  
Ronald Reagan ◽  
Government Budget ◽  
Government Deficits ◽  
Tax Smoothing ◽  
The Government ◽  
Monetary And Fiscal Policy

This chapter examines the large net-of-interest deficits in the U.S. federal budget that have marked the administration of Ronald Reagan. It explains the fiscal and monetary actions observed during the Reagan administration as reflecting the optimal decisions of government policymakers. The discussion is based on an equation whose validity is granted by all competing theories of macroeconomics: the intertemporal government budget constraint. The chapter first considers the government budget balance and the optimal tax smoothing model of Robert Barro before analyzing monetary and fiscal policy during the Reagan years: a string of large annual net-of-interest government deficits accompanied by a monetary policy stance that has been tight, especially before February 1985, and even more so before August 1982. Indicators of tight monetary policy are high real interest rates on government debt and pretax yields that exceed the rate of economic growth.

scholarly journals Are Policy Analogies Persuasive? The Household Budget Analogy and Public Support for Austerity

2021 ◽  
pp. 1-19
Author(s):  
Lucy Barnes ◽  
Timothy Hicks
Keyword(s):  
Analogical Reasoning ◽  
Public Support ◽  
Case Scenario ◽  
The United Kingdom ◽  
Cognitive Problem ◽  
Government Deficits ◽  
Ex Post ◽  
The Government ◽  
Original Survey ◽  
Household Borrowing

Abstract Public opinion on complex policy questions is shaped by the ways in which elites simplify the issues. Given the prevalence of metaphor and analogy as tools for cognitive problem solving, the deployment of analogies is often proposed as a tool for this kind of influence. For instance, a prominent explanation for the acceptance of austerity is that voters understand government deficits through an analogy to household borrowing. Indeed, there are theoretical reasons to think the household finance analogy represents a most likely case for the causal influence of analogical reasoning on policy preferences. This article examines this best-case scenario using original survey data from the United Kingdom. It reports observational and experimental analyses that find no evidence of causation running from the household analogy to preferences over the government budget. Rather, endorsement of the analogy is invoked ex post to justify support for fiscal consolidation.

scholarly journals Budget Deficits: Rhetoric and Reality

1989 ◽  
Vol 3 (2) ◽  
pp. 73-93 ◽  
Author(s):  
Robert Eisner
Keyword(s):  
Fiscal Policy ◽  
Public Goods ◽  
News Media ◽  
Empirical Data ◽  
Budget Deficit ◽  
Economic Problem ◽  
Budget Deficits ◽  
Relevant Model ◽  
Government Deficits ◽  
Economics Profession

Whatever the real or imagined ills of the economy, the news media, most politicians and a fair proportion of the economics profession are quick to point to the culprit: “the budget deficit.” No matter that few appear to know or care precisely what deficit they are talking about or how it is measured. No matter that few bother to explain in terms of a relevant model just how government deficits may be expected to impact the economy. No matter that few offer any empirical data to sustain their judgments. I believe there are serious problems with our fiscal policy. These relate to fundamental national priorities and the provision of public goods, now and for the future. But the current size of the federal deficit is not “our number one economic problem,” if indeed it is a problem at all.

scholarly journals Evolving Federations and Regional Public Deficits: Testing the Bailout Hypothesis in the Spanish Case

10.1068/c0444 ◽  
2005 ◽  
Vol 23 (3) ◽  
pp. 437-453 ◽  
Author(s):  
Santiago Lago-Peñas
Keyword(s):  
Financial Markets ◽  
Empirical Research ◽  
Central Government ◽  
Traditional Model ◽  
Factors Affecting ◽  
The Real ◽  
Government Deficits ◽  
Tax Autonomy ◽  
Real Behavior ◽  
Public Deficits

High debt autonomy and low tax autonomy often characterize evolving federations, making the bailout hypothesis very attractive in resolving subcentral government deficits. However, meeting both conditions is not enough to conclude that bailout expectations are the main reason for a potential deficit. There are many other factors affecting expectations and the real behavior of the agents involved: central government, subcentral governments, and the financial markets. Empirical research is the only means by which to determine the relevance of the bailout problem in each situation. To demonstrate this argument, the author describes an exhaustive analysis of the Spanish case. The main conclusion is that deficit seems to be better understood by a more traditional model of fiscal choices than by bailout expectations.

scholarly journals Macroeconomics of growth

2019 ◽  
pp. 59-91
Author(s):  
Deepak Nayyar
Keyword(s):  
Economic Growth ◽  
Degrees Of Freedom ◽  
Policy Instruments ◽  
High Growth ◽  
Supply Side ◽  
Demand Side ◽  
Macroeconomic Policies ◽  
Government Deficits ◽  
Inflation Rates ◽  
Investment Growth

Economic growth over fifty years in the Asian-14 has been stunning. Investment and savings, which rose rapidly, were the main drivers of growth. Education was also a sustained driver of growth on the supply-side. From the demand-side, growth was primarily private-consumption-expenditure led and investment led. The interaction between the supply-side and the demand-side suggests a virtuous circle of cumulative causation, where rapid investment growth coincided in time with rapid export growth, leading to rapid GDP growth. In macroeconomic management, the successful countries did not follow orthodox prescriptions of balanced budgets and price stability. Their primary macroeconomic objectives were economic growth and employment creation. Their macroeconomic policies were also more versatile in their use of policy instruments. Their success in maintaining high growth rates increased their degrees of freedom, which enabled them to finance government deficits and raise sustainable levels of government borrowing, while making higher inflation rates politically more acceptable, which would not have been possible if economic growth was slow.

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