Search results

The purpose of this paper is to assess whether expenditure decentralization has contributed to weakening fiscal performance in Europe. Using a panel of EU15 countries for the period 1995-2011, we estimate three econometric models and ask the following questions: (1) does the form of spending decentralization affect the general government fiscal balance?; (2) is there evidence of spending duplication?; and (3) are soft budget constraints prevalent at the subnational level in Europe? Our results indicate that current decentralization models may have some shortcomings and efforts to achieve fisca

A number of emerging markets have experienced substantial real exchange rate appreciationin recent years, generating concerns about competitiveness and prompting policymakers torespond with a combination of mitigating policies. This paper shows that fiscal policy can play a role in alleviating these pressures. Using a sample of 28 emerging market economies over 1983-2011, we estimate a dynamic model of the real exchange rate and find that a permanent fiscal adjustment may reduce appreciation pressures over the long term. Furthermore, the composition of public spending matters, with reductions

Cover -- Contents -- I. Introduction -- II. Review Of Existing Datasets -- III. Methodological Considerations -- IV. Overview of the Global Debt Database -- V. Global Debt Trends -- VI. Conclusion And Way Forward -- BOXES -- 1. A Multidimensional Approach to Debt Statistics: The Example of Mexico -- A.1.1. Compilation of the Global Debt Database -- FIGURES -- 1. Private Debt Coverage in Approach 2 vs. IIP Approach -- 2. Country Coverage in the Global Debt Database -- 3. Country Coverage in the Global Debt Database -- 4. Private Debt: Country Coverage in Global Debt Database vs. Existing Datasets -- 5. Public Debt: Country Coverage in the Global Debt Database vs. Existing Datasets -- 6. Largest Debtors by Income Group, 2016 -- 7. Total Debt -- 8. Change in Public and Private Debt -- 9. Total Debt: World and G20 -- 10. Contribution to Total Debt by Income Group -- 11. Private Debt by Income Group -- 12. Public Debt by Income Group -- 13. Total Debt by Region -- 14. Private Debt by Region -- 15. Public Debt by Region -- A.1.1. Global Debt Database: Country Coverage -- TABLES -- 1. Comparison of Existing Debt Datasets -- 2. Selected Countries and Income Group: Total Debt -- A.1.1. Global Debt Database: Characteristics of Private Debt Data -- A.2.1. Classification by Income Group -- A.2.2. Classification by Region -- ANNEXES -- I. The Global Debt Database: Definitions, Methodology and Sources -- II. Country Classification

Cover -- Contents -- I. Introduction -- II. Data And Definitions -- A. Data -- B. Private Deleveraging: Definitions And Statistics -- III. Stylized Facts -- IV. Private Deleveraging In Modern History -- A. Methodology -- B. What Happens Before, During, And After Private Deleveraging? -- V. Tackling Causality -- A. The Ipwra Method -- B. Estimating The Causal Impact Of Private Deleveraging -- VI. Concluding Remarks -- References -- ANNEXES -- 1. Data: Country Coverage -- 2. Private Debt And Leverage Flows -- 3. Deleveraging Episodes By Income Groups -- 4. Additional Figures And Tables -- FIGURES -- 1. Advanced Economies: Gross Debt -- 2. Spain: Gross Debt -- 3. Private Debt in the Global Debt Database -- 4. Number of Deleveraging Episode -- 5. Probability of Deleveraging by Decades -- 6. Incidence of Private Deleveraging, 1950-2016 -- 7. Macroeconomic Dynamics During Private Deleveraging -- 8. Sources of Change in Public Debt During Private Deleveraging in Advanced Countries -- 9. "Growthless" vs "High Growth" Deleveraging -- 10. "Post-GFC" vs. "Pre-GFC" Deleveraging Episodes -- 11. Deleveraging Episodes -- 12. Cumulative Impact of Private Deleveraging on GDP and Public Debt -- TABLES -- 1. Average Features of Private Deleveraging Episodes -- 2. Private Deleveraging Episodes: Crisis vs. Non-crisis -- 3. Average Macro-Economic Conditions during Normal Times -- 4. Determinants of Private Deleveraging -- 5. Impact of Private Deleveraging on Growth and Public Debt (IPWRA).

Using firm-level data for Estonia for the years 1997-2005, we analyze the impact of international competition on firm dynamics, considering both firm closedown and product switching. We contribute to the literature in two important ways: (1) this is the first paper to study the determinants of exit and product switching in an emerging market; and (2) we consider explicitly the role of export opportunities. Our results indicate that globalization does not affect firm exit significantly but it is an important factor explaining product switching. Previous studies on industrial countries have show

Abstract
In the wake of the COVID-19 pandemic, debt levels in emerging and developing economies have surged raising concerns about fiscal sustainability. Historically, negative interest-growth differentials in these countries have played a debt-stabilizing role. But is this enough to prevent countries from falling into debt distress? Drawing from a sample of 150 emerging and developing economies going back to the 1970s, we find that interest-growth differentials have remained relatively low dampening debt increases in the run up to a crisis. But in the face of persistent primary deficits, debt service tends to rise abruptly—particularly in emerging markets—and a fiscal crisis ensues. There is also evidence that a large part of the debt build-up around crises stems from valuation effects associated with external debt and the materialization of contingent liabilities. These findings underscore that, though not necessarily a red-herring, low interest-growth differentials cannot fully offset the deleterious effects of large fiscal deficits, forex exposures, or hidden debts.