Primary Surplus Behavior and Risks to Fiscal Sustainability in Emerging Market Countries

Primary Surplus Behavior and Risks to Fiscal Sustainability in Emerging Market Countries

4.11 - 1251 ratings - Source



This paper proposes a probabilistic approach to public debt sustainability analysis (DSA) using qfan charts.q These depict the magnitude of risks-upside and downside-surrounding public debt projections as a result of uncertain economic conditions and policies. We propose a simulation algorithm for the path of public debt under realistic shock configurations, combining pure economic disturbances (to growth, interest rates, and exchange rates), the endogenous policy response to these, and the possible shocks arising from fiscal policy itself. The paper emphasizes the role of fiscal behavior, as well as the structure of disturbances facing the economy and due to fiscal policy, in shaping the risk profile of public debt. Fan charts for debt are derived from the qmarriageq between the pattern of shocks on the one hand and the endogenous response of fiscal policy on the other. Applications to Argentina, Brazil, Mexico, South Africa, and Turkey are used to illustrate the approach and its limitations.A aquot;Fan-Chartaquot; Approach Oya Celasun, Mr. Xavier Debrun, Mr. Jonathan David Ostry. captures the ... This algorithm can produce an arbitrarily large number of debt paths (say 1000 or 10, 000) corresponding to different shock constellations.


Title:Primary Surplus Behavior and Risks to Fiscal Sustainability in Emerging Market Countries
Author: Oya Celasun, Mr. Xavier Debrun, Mr. Jonathan David Ostry
Publisher:International Monetary Fund - 2006-03-01
ISBN-13:

You must register with us as either a Registered User before you can Download this Book. You'll be greeted by a simple sign-up page.

Once you have finished the sign-up process, you will be redirected to your download Book page.

How it works:
  • 1. Register a free 1 month Trial Account.
  • 2. Download as many books as you like (Personal use)
  • 3. Cancel the membership at any time if not satisfied.


Click button below to register and download Ebook
Privacy Policy | Contact | DMCA