Budget deficits, government debt, and long-term interest rates in Japan

Kameda, Keigo

doi:10.1016/j.jjie.2014.02.001

Cited by 26 publications

(21 citation statements)

References 21 publications

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“…The empirical result showed a two-way causality relationship between the fiscal deficit and the output in this country. Kameda (2014) analyses the relationship between budget deficits and some macros factors in the Japanese economy. The estimation result found that the real budget deficit in Japan in 2008 caused an approximately 0.39-0.63% decrease in the real GDP in this year.…”

Section: Literature Reviewmentioning

confidence: 99%

The effect of fiscal deficit on economic growth in an emerging economy: Evidence from Vietnam

Tùng

2018

Journal of International Studies

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Fiscal deficit has been sharply increasing in the developing economies worldwide. This paper examines the effect of fiscal deficit on economic growth in Vietnam, the country now is one of the most dynamically emerging countries, but its government has been facing large fiscal deficits for many years by now. Our study has applied the Error Correction model on the quarterly data of 2003-2016. The empirical results strongly indicate there is a cointegration relationship between fiscal deficit and economic growth in Vietnam, in which fiscal deficit had harmful effects on economic growth in both short and long run. In particular, the correlation analysis has confirmed that fiscal deficit can hurt not only the gross output but also private investments, foreign direct investments, and net exports. Our results provide evidence for policymakers, and not only in Vietnam but also in other emerging countries which are in need of urgent solutions so that to reduce the fiscal deficit rate and have more sustainable growth in the future.

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Section: Literature Reviewmentioning

confidence: 99%

The effect of fiscal deficit on economic growth in an emerging economy: Evidence from Vietnam

Tùng

2018

Journal of International Studies

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“…The budget deficit is a significant instrument of fiscal policy. In particular, one marks that it has a more powerful influence on economic growth than government debt (Kameda, 2014); the negative correlation between the growth of the state budget deficit and the level of economic growth remains. Thus, an important task is to justify sources of its funding (Arjomand, Emami, Salimi, 2016); it is expedient to increase the share of the budget deficit in the gross domestic product to have a countercyclical effect on the economic growth (Taylor, Proaño, Carvalho, Nelson, 2012).…”

Section: Approaches To the Formation Of Fiscal Policymentioning

confidence: 99%

Fiscal Policy and Institutional Budget Architectonics

Чугунов¹,

Makohon²,

Krykun³

2020

BJES

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The purpose of the article is to study the role of fiscal policy in the context of the development of institutional budget architectonics aimed at ensuring macroeconomic stability, boosting economic growth, strengthening human potential, improving public welfare and defining approaches to its formation in advanced and transition economies. Comparative and factor methods make it possible to cover the peculiarities of institutional environment of the formation of fiscal policy in EU countries and Ukraine in the context of the development of the institutional budget architectonics and to identify ways for its improvement. Methodology. Substantiation of the role of fiscal policy in terms of the development of institutional budget architectonics, determination of its strategic orientations are based on generalization and systematization of experience of advanced and transition economies. For this very reason, the authors analyse and assess the fiscal policy and define special aspects of the formation and implementation of its components in relevant countries. Results show that to increase the effectiveness of the fiscal policy, it is expedient to ensure its interrelation with other components of financial policy based on a combination of fiscal and motivation function. Effective institutional budget architectonics provides means for creating conditions for sustainable economic growth, achieving strategic goals of socio-economic development of the country. Significant tasks of the development of institutional budget architectonics are regulation of the ratio between direct and indirect tax revenues, the structure of budget expenditures in terms of functional, economic classifications, maintaining the budget gap and public debt at the level that contributes to the financial and economic stability of the country, taking into account economic cyclical nature. Practical implications. A feasible budget architectonics would facilitate the maintenance of macroeconomic stability and accelerate economic growth. It is expedient to carry out institutional changes of budget architectonics on the ground of dynamic interconnection of budget and macroeconomic indicators. Value/originality. Fiscal policy plays a significant part in the process of government regulation of socio-economic development of the country. Elaboration of fiscal policy approaches in the context of the development of institutional budget architectonics is an important prerequisite for improving the quality of budget planning, ensuring the strength, stability and dynamic balance of the budget system. It is advantageous to introduce adaptive institutional changes into the budget architectonics in order to accelerate economic growth. Therefore, the article covers the essence and role of institutional budget architectonics aimed at ensuring macroeconomic stability, accelerating economic growth, developing human potential, improving public welfare; it defines the approaches to its development in transition and advanced economies. The authors establish that effective f...

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“…While Ramey (2011) determines the excessive expenditure is causing interest rate and needs to be controlled. In the perspective of neoclassical framework, Kameda (2008) states that the nexus between interest rate and excessive expenditure in Japan economy. And also explore the excessive expenditure has more influenced on the interest rate in the context to the government debt.…”

Section: Literature Reviewmentioning

confidence: 99%

Influence of Excessive Expenditure of the Government in Perspective of Interest Rate and Money Circulation Which in Turn Affects the Growing Process in Pakistan

Rahman

2019

Asian Journal of Economics and Empirical Research

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In this study an attempt was made to investigate the affiliation among the excessive expenditure, interest rate, inflation, money supply and growing rate. For this purpose, time series data comprises 1976 to 2018 were collected from the Handbook and world development indicator. The analyses show a good number of findings. Firstly, the unit root test results show that all the variables are stationary at level, except inflation but appear stationary at first difference. However, ZA test pronounces structural break in the data with a different time period. This of course leads the study to determine the short and long-term association among the variables. The vector error correction and Johansen cointegration reveals the short and long-run relationship exists among the variables. While excessive expenditure and the money circulation have one-way granger causality with the growth rate. Moreover, the diagnostic and stability tests describe that model specification, auto correlation and model are normal. Even impulse response pronounces that all the variables would have a positive influence on the growth rate in the future. Based on this, the study recommends that government should not create the atmosphere of the crowding out. No doubt interest rate favors the economy, but government should also manage its expenditure.

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Budget deficits, government debt, and long-term interest rates in Japan

Cited by 26 publications

References 21 publications

The effect of fiscal deficit on economic growth in an emerging economy: Evidence from Vietnam

The effect of fiscal deficit on economic growth in an emerging economy: Evidence from Vietnam

Fiscal Policy and Institutional Budget Architectonics

Influence of Excessive Expenditure of the Government in Perspective of Interest Rate and Money Circulation Which in Turn Affects the Growing Process in Pakistan

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