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Public Debt Sustainability In Serbia Before And During The Global Financial Crisis

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  • Vladimir Andrić
  • Milojko Arsić
  • Aleksandra Nojković

Abstract

We have analyzed the behaviour of primary fiscal balance and public debt in Serbia before and in the aftermath of the global financial crisis. The results of our analysis are: i) public debt to GDP ratioexhibits (near) unit root behaviour with an overall upward time trend; ii) the response of primary fiscal balance to public debt has been insufficient to mean revert the upward trend in government debt; iii) the efforts of the Serbian government to repay the debt principal after the fiscal rule breach have not been persistent, providing empirical support to the fiscal fatigue hypothesis; iv) the government budget constraint has deteriorated since the beginning of the global financial crisis; v) the response of primary fiscal balance to public debt from the onset of the global financial crisis has dropped more severely in comparison to other European economies.

Suggested Citation

  • Vladimir Andrić & Milojko Arsić & Aleksandra Nojković, 2016. "Public Debt Sustainability In Serbia Before And During The Global Financial Crisis," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 61(210), pages 47-78, July - Se.
    • Handle: RePEc:beo:journl:v:61:y:2016:i:210:p:47-78
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    Cited by:

    1. Miroljub Labus, 2020. "Transition And Post-Conflict Macroeconomic Policies In Serbia," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 65(226), pages 73-102, July – Se.
    2. Tashevska, Biljana & Trpkova-Nestorovska, Marija & Trenovski, Borce, 2017. "Estimating a fiscal reaction function for the South East European countries," MPRA Paper 91298, University Library of Munich, Germany, revised 2018.
    3. Sofie Buch Mejsner & Maria Kristiansen & Leena Eklund Karlsson, 2021. "Civil Servants and Non-Western Migrants’ Perceptions on Pathways to Health Care in Serbia—A Grounded Theory, Multi-Perspective Study," IJERPH, MDPI, vol. 18(19), pages 1-17, September.
    4. Vladan Ivanovic & Endrit Lami & Drini Imami, 2023. "Political Budget Cycles in Early Versus Regular Elections: The Case of Serbia," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 65(3), pages 551-581, September.

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    More about this item

    Keywords

    Serbia; unit root tests; fiscal reaction functions; global financial crisis;
    All these keywords.

    JEL classification:

    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • P20 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - General

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