IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/840.html
   My bibliography  Save this paper

Public sector debt, fiscal deficits, and economic adjustment : a comparative study of six EMENA countries

Author

Listed:
  • Thorne, Alfredo E.
  • Dastgheib, Azita

Abstract

The authors analyzed the experience of six countries (Algeria, Morocco, Pakistan, Portugal, Turkey, and Yugoslavia) and compared it with the experiences of Latin American countries. They conclude that some countries successfully absorbed the external shock of the 1980s by: (a) minimizing the effects of the external shock by combining external and domestic debt strategies; (b) adjusting their fiscal deficits; (c) experiencing a positive external shock; and (d) fostering growth by stimulating export growth and developing domestic financial markets. No single country fully implemented this strategy; those most successful in doing so were Morocco, Portugal, and Turkey. Their experience contrasts with that of some Latin American countries that experienced a similar external shock but failed to undertake fiscal adjustment and financed most of their deficit through money finance - thus experiencing high inflation levels and overburdening their private sector. In some respects, Yugoslavia had the same experience.

Suggested Citation

  • Thorne, Alfredo E. & Dastgheib, Azita, 1992. "Public sector debt, fiscal deficits, and economic adjustment : a comparative study of six EMENA countries," Policy Research Working Paper Series 840, The World Bank.
    • Handle: RePEc:wbk:wbrwps:840
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/1992/01/01/000009265_3961002081503/Rendered/PDF/multi0page.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Easterly, William & Schmidt-Hebbel, Klaus, 1991. "The macroeconomics of public sector deficits : a synthesis," Policy Research Working Paper Series 775, The World Bank.
    2. Faini, Riccardo, 1991. "The macroeconomics of the public sector deficit : the case of Morocco," Policy Research Working Paper Series 631, The World Bank.
    3. Fischer, Stanley & Easterly, William, 1990. "The Economic of the Government Budget Constraint," The World Bank Research Observer, World Bank, vol. 5(2), pages 127-142, July.
    4. Jean-Claude Chouraqui & Brian Jones & Robert Bruce Montador, 1986. "Public Debt in a Medium-Term Context and Its Implications for Fiscal Policy," OECD Economics Department Working Papers 30, OECD Publishing.
    5. Vito Tanzi, 1977. "Inflation, Lags in Collection, and the Real Value of Tax Revenue (L'inflation, les retards de recouvrement et la valeur réelle des recettes fiscales) (Inflación, desfases en la recaudación y valor ," IMF Staff Papers, Palgrave Macmillan, vol. 24(1), pages 154-167, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ifeanyi Onwuka, 2022. "Budget Deficit, Inflation and Economic Growth in Nigeria: An Empirical Analysis," International Journal of Economics and Financial Research, Academic Research Publishing Group, vol. 8(1), pages 1-14, 03-2022.
    2. Sanogo, Issa & Gyengani, Zakaria, 2008. "Private investment in guinea, does macro-instability matter? A comparative analysis," MPRA Paper 11606, University Library of Munich, Germany.
    3. Soledad Arellano & Felipe Larraín, 1996. "Tipo de Cambio Real y Gasto Público: Un Modelo Econométrico para Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 33(98), pages 47-76.
    4. Albuquerque, Pedro H. & Gouvea, Solange, 2009. "Canaries and vultures: A quantitative history of monetary mismanagement in Brazil," Journal of International Money and Finance, Elsevier, vol. 28(3), pages 479-495, April.
    5. Patrick Honohan, 1994. "The Fiscal Approach to Financial Intermediation Policy," Papers WP049, Economic and Social Research Institute (ESRI).
    6. Jacob Engwerda & Davoud Mahmoudinia & Rahim Dalali Isfahani, 2016. "Government and Central Bank Interaction under Uncertainty: A Differential Games Approach," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 20(2), pages 225-259, Spring.
    7. J. Paul Dunne a,† & Sam Perlo-Freeman ‡ & Aylin Soydan §, 2004. "Military expenditure and debt in South America," Defence and Peace Economics, Taylor & Francis Journals, vol. 15(2), pages 173-187, April.
    8. Akhand Akhtar Hossain, 2009. "Central Banking and Monetary Policy in the Asia-Pacific," Books, Edward Elgar Publishing, number 12777.
    9. Burnside, Craig & Eichenbaum, Martin & Rebelo, Sergio, 2006. "Government finance in the wake of currency crises," Journal of Monetary Economics, Elsevier, vol. 53(3), pages 401-440, April.
    10. Mr. Guillermo Calvo & Mr. Carlos A. Végh Gramont, 1992. "Currency Substitution in Developing Countries: An Introduction," IMF Working Papers 1992/040, International Monetary Fund.
    11. FA Al‐Marhubi, 2000. "Income inequality and inflation: the cross‐country evidence," Contemporary Economic Policy, Western Economic Association International, vol. 18(4), pages 428-439, October.
    12. Marshall, Jorge & Schmidt-Hebbel, Klaus, 1989. "Economic and policy determinants of public sector deficits," Policy Research Working Paper Series 321, The World Bank.
    13. Hong-Ghi Min, 2002. "Inequality, the price of nontradables, and the real exchange rate : theory and cross-country evidence," Policy Research Working Paper Series 2758, The World Bank.
    14. Israel Fainboim & Mauricio Olivera & Julio César Alonso, 1997. "La sostenibilidad de la política fiscal colombiana," Coyuntura Económica, Fedesarrollo, September.
    15. Helder Ferreira de Mendonça & Ytallo Brito, 2021. "The link between public debt and investment: an empirical assessment from emerging markets," Applied Economics, Taylor & Francis Journals, vol. 53(50), pages 5864-5876, October.
    16. Busato, Francesco & Varlese, Monica & Ulloa Severino, Claudia, 2022. "Public debt heterogeneity at country level: an empirical analysis," MPRA Paper 113812, University Library of Munich, Germany.
    17. Sarmiento, Julio & Cayon, Edgardo & Collazos, María & Sandoval, Juan S., 2017. "Positive asymmetric information in volatile environments: The black market dollar and sovereign bond yields in Venezuela," Research in International Business and Finance, Elsevier, vol. 41(C), pages 547-555.
    18. Espinosa-Vega, Marco A & Yip, Chong K, 1999. "Fiscal and Monetary Policy Interactions in an Endogenous Growth Model with Financial Intermediaries," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(3), pages 595-615, August.
    19. ZeinabPartow, 2005. "La Relación Inflación-Crecimiento: Un Resumen Con Algunas Implicaciones Para Colombia," Borradores de Economia 3079, Banco de la Republica.
    20. Zeinab Partow, 1995. "La Relación Inflación-Crecimiento: Un Resúmen con algunas Implicaciones para Colombia," Borradores de Economia 023, Banco de la Republica de Colombia.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:840. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Roula I. Yazigi (email available below). General contact details of provider: https://edirc.repec.org/data/dvewbus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.