Public debt sustainability and endogenous seigniorage in Braziltime-series evidence from 1947-1992

Resumo

In this paper, we investigate three central issues in public finance. First, was the path of public debt sustainable during 1947-1992? Second, how has the government balanced the budget after shocks to either revenues or expenditures were observed? Third, are expenditures exogenous? The results show that (i) debt is sustainable in econometric tests, with the budget being balanced almost entirely through changes in taxes, regardless of the cause of the initial imbalance. Expenditures are weakly exogenous; (ii) the behavior of a 'rational' Brazilian consumer may be consistent with Ricardian Equivalence; (iii) seigniorage revenues are critical in restoring intertemporal budget equilibrium. (C) 2000 Elsevier Science B.V. All rights reserved. JEL classification: H6: H3; C3.

Ficha do documento

Tipo

Artigo científico

Ano

2000

Instituição

Elsevier Science Bv

Fonte

Repositório da FGV

Idioma

Inglês

Acesso

Acesso restrito

DOI

10.1016/S0304-3878(00)00078-X

Identificador

oai:repositorio.fgv.br:10438/23014

Temas

EconomiaFinanças Públicas

Palavras-chave

Government-debt sustainabilityUnit-root and co-integration testsUnit rootBudget deficitsHigh inflationCointegrationEconomiaFinanças públicas - BrasilDívida pública