Inflation Stabilization, Fiscal Deficits, and Public Debt Management in Poland

Wijnbergen, Sweder van; Budina, Nina T

doi:10.1006/jcec.2001.1710

Cited by 8 publications

(9 citation statements)

References 4 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The accounting approach is based on the government budget identity, and sustainability of a primary deficit or surplus is measured by its capability to generate a constant debt : GDP ratio, given a growth target. The approach that we adopted to analyse fiscal policy consistency is based on the works of Anand and van Wijnbergen () and van Wijnbergen and Budina ().…”

Section: A Framework For Analysing Consistency Of Fiscal Policymentioning

confidence: 99%

“…In general, whereas it is possible for the relationship between prices and money to weaken, budget deficits beyond ‘certain financeable limits’ will clearly negate the possibility of attaining other objectives of macroeconomic policy (van Wijnbergen, ). One of the most common approaches used in the literature to assess fiscal policy consistency is the accounting approach (Sargent and Wallace, ; Wijnbergen and Budina, ). The accounting approach incorporates the central bank accounts into the basic public sector budget identity to determine ‘financeable’ levels of the deficit.…”

Section: Introductionmentioning

confidence: 99%

“…Sowa's () accounting‐based analysis of fiscal sustainability in Ghana showed that fiscal policy was consistent in 1985 and 1989, whereas government did not maintain consistent fiscal deficits between 1986 and 1988, and inflation in these years was well above targets. Van Wijnbergen and Budina (), on the other hand, analyse the consistency between fiscal deficits and inflation targets in Poland and show consistency between inflation targets and fiscal policy for the year 1992, but only on the account of low market interest rates on external debt. Buffie et al () show that deficit reduction results in lower inflation in the long run.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Fiscal Policy Consistency and Its Implications for Macroeconomic Aggregates: The Case of Uganda

Hisali

Guloba

2011

J of Intl Development

View full text Add to dashboard Cite

The study employed the accounting approach to fiscal policy consistency to analyse the sustainability of Uganda's fiscal policy. The deficits were calculated from the financing side by considering increases in liabilities of the consolidated government. To assess whether the deficits have been compatible with other macroeconomic targets, the financeable deficit is derived and compared with the calculated actual deficits. The results show that the consolidated deficit is consistent with attainment of target outcomes for other macroeconomic variables, most notably inflation and gross domestic product growth rates. However, the inflation target has been achieved at the cost of an unsustainable domestic debt.

show abstract

Section: A Framework For Analysing Consistency Of Fiscal Policymentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Fiscal Policy Consistency and Its Implications for Macroeconomic Aggregates: The Case of Uganda

Hisali

Guloba

2011

J of Intl Development

View full text Add to dashboard Cite

show abstract

“…by governments (in an environment of increasing interest rate) may be harmful to inflation and macroeconomic stabilisation process. For instance, S. Wijnbergen and N. Budina (2001) showed the importance of public debt management in the inflation and macroeconomic stabilisation process in Poland. They used a simple framework in an environment of sparse data and structural change to establish links between inflation, fiscal deficits, and public debt.…”

Section: Introductionmentioning

confidence: 99%

“…They used a simple framework in an environment of sparse data and structural change to establish links between inflation, fiscal deficits, and public debt. Effective public debt management together with a restrictive monetary policy has successfully removed obstacles to achieving a stable and sustainable inflation process in Poland (Wijnbergen, Budina, 2001).…”

Section: Introductionmentioning

confidence: 99%

Public Debt and Inflation: A Review of International Literature

Aimola

Odhiambo

2020

Folia Oeconomica Stetinensia

View full text Add to dashboard Cite

Research background: Public debt arises mainly from debt-financed deficits. More and more countries are resorting to additional public indebtedness to raise additional financial resources to meet government funding needs, which are unattainable by the usual tax means. As a result, increasingly, government spending is rising faster than revenue is received, and the excess is financed mainly through domestic and external borrowings. Expensive borrowings by a government (in an environment of increasing interest rates) may be harmful to inflation and the macroeconomic stabilisation process. This trend is raising concerns among policymakers as it undermines macroeconomic stability, especially in developing economies with relatively weak and dependent monetary authorities in the formulation and implementation of monetary policies. Hence, the association between public debt and inflation is of importance in the inflationary process of an economy.Purpose: In this paper, theoretical and empirical literature on the link between public debt and inflation has been surveyed in detail. The focus of the paper was centred on the review of literature on the link between total public debt, external public debt, domestic public debt and inflation.Research methodology: This paper presents an extensive review of scholarly studies on the link between public debt and inflation based on their results. The paper analysed, synthesised, and critically evaluated previous studies on the relationship between public debt and inflation on both the theoretical and empirical fronts.Results: The literature reviewed revealed the association between public debt and inflation. The surveyed literature shows that the relationship between public debt and inflation varies from country to country, with either a positive or negative relationship. However, in the majority of the literature, the link between public debt and inflation tilts towards a positive relationship. This finding is more prominent in indebted countries with higher levels of public debt and a less-developed financial market. Although there is no consensus on the positive or negative relationship between public debt and inflation, the study found that a positive relationship between public debt and inflation tends to predominate among the studies reviewed.Novelty: The study provides an insight into the relationship between public debt and inflation based on a detailed review of literature on the subject in both developed and developing economies.

show abstract

Alternative monetary policies and fiscal regime in new EU members

Mikek

2008

Economic Systems

View full text Add to dashboard Cite

Inflation Stabilization, Fiscal Deficits, and Public Debt Management in Poland

Cited by 8 publications

References 4 publications

Fiscal Policy Consistency and Its Implications for Macroeconomic Aggregates: The Case of Uganda

Fiscal Policy Consistency and Its Implications for Macroeconomic Aggregates: The Case of Uganda

Public Debt and Inflation: A Review of International Literature

Alternative monetary policies and fiscal regime in new EU members

Contact Info

Product

Resources

About