The adjustment of public déficit in the presence a high debt: observations about the Brazilian case
This article examines the obstacles to public sector adjustment arising from theexistence of a high level of government debt in the form of short-term or floating interestrate obligations. In this context, adjustment programmes that rely exclusively on increasesin taxation and/or reductions in non-f...
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| Tipo de recurso: | artículo |
| Estado: | Versión publicada |
| Fecha de publicación: | 1989 |
| País: | Brasil |
| Institución: | EDITORA 34 |
| Repositorio: | Revista de Economia Política |
| Idioma: | portugués |
| OAI Identifier: | oai:ojs2.centrodeeconomiapolitica.org:article/1628 |
| Acceso en línea: | https://centrodeeconomiapolitica.org.br/repojs/index.php/journal/article/view/1628 |
| Access Level: | acceso abierto |
| Palabra clave: | Ajuste fiscal dívida pública política fiscal Fiscal adjustment public debt fiscal policy |
| Sumario: | This article examines the obstacles to public sector adjustment arising from theexistence of a high level of government debt in the form of short-term or floating interestrate obligations. In this context, adjustment programmes that rely exclusively on increasesin taxation and/or reductions in non-financial government expenditures have limited possibilitiesof success. Besides making the budget highly vulnerable to increases in external andinternal interest rates, the size and composition of Brazilian public debt severely restrict theeffectiveness of monetary and exchange-rate policies. The article concludes that under presentcircumstances a successful stabilization programme would have to involve fiscal adjustment,a shock treatment against inflation, and a restructuring of government debt. JEL Classification: H63; E62. |
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