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COVID-19 crisis and the public debt issue:The case of Italy

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  • Schilirò, Daniele

Abstract

The COVID-19 pandemic has left the global economy with severe health damage, losses of life and a sharp recession. In addition, it has resulted in a rise of public debts, heightening the tension between meeting major policy goals, growth, employment, health system, environment and containing debt vulnerabilities. This paper examines the literature regarding the debt–growth nexus and the issue of debt sustainability. In particular, it highlights the evidence of some empirical literature showing that high public debt hampers growth, and that countries with high public debt are vulnerable to adverse shocks. In addition, the paper focuses on the case of Italy, a country characterized by a high public debt, low growth and other economic weaknesses, with the purpose to claim a strategy and indicate policy measures.

Suggested Citation

  • Schilirò, Daniele, 2020. "COVID-19 crisis and the public debt issue:The case of Italy," MPRA Paper 103997, University Library of Munich, Germany, revised Nov 2020.
    • Handle: RePEc:pra:mprapa:103997
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    More about this item

    Keywords

    COVID-19; crisis; public debt; growth; debt sustainability; Italian economy;
    All these keywords.

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • F01 - International Economics - - General - - - Global Outlook
    • H6 - Public Economics - - National Budget, Deficit, and Debt
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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