Revisiting U. S. Public and Private Debt in April 2011

2011 ◽  
Author(s):  
Bob Blain
Keyword(s):  
Private Debt ◽  
Public And Private

scholarly journals DO PUBLIC AND PRIVATE DEBT LEVELS AFFECT THE SIZE OF FISCAL MULTIPLIERS?

2017 ◽  
Vol 32 (3) ◽  
pp. 209
Author(s):  
Chairul Adi
Keyword(s):  
Public Investment ◽  
The Other ◽  
Public Expenditures ◽  
Fiscal Policies ◽  
Data Set ◽  
Private Debt ◽  
Public And Private ◽  
Economic Output ◽  
Other Hand ◽  
The Impact

This paper investigates the effectiveness of fiscal policies – as measured by the impact and cumulative multipliers – and how they interact with public and private debt. Harnessing the moderated panel regression approach, based on the yearly data set of several economies during the period from 1996 to 2012, the analysis is focused on the impact of spending-and-revenue-based fiscal policies on economic growth and how these fiscal instruments interact with public and private indebtedness. The result of spending stimuli advocates the basic Keynesian theory. An increase in public expenditures contemporaneously generates a positive multiplier, of around 0.29 – 0.44 and around 0.45 – 0.58 during two years. Decomposing the expenditures into their elements, this paper documents a stronger impact from public investment than that from government purchases. On the other hand, the revenue stimuli seem to follow the Ricardian Equivalence Hypothesis (REH), arguing that current tax cuts are inconsequential. The impact and cumulative multipliers for this fiscal instrument have mixed results, ranging from -0.21 to 0.05 and -0.26 to 0.06, respectively. Moreover, no robust evidence is found to support the argument that government debt moderates the effectiveness of fiscal policies. The size of the multipliers for both spending and revenue policies remain constant with the level of public debt. On the other hand, private debt appears to show a statistically significant moderating effect on spending stimuli. Its impact on spending multipliers, however, is economically insignificant. The moderation effect of private debt on the revenue stimuli does not seem to exist. Finally, this paper documents that both public and private debt exhibit a negative and statistically significant estimation for economic output.

Earthly Reward to the Religious: Religiosity and the Costs of Public and Private Debt

2018 ◽  
Vol 53 (5) ◽  
pp. 2131-2160 ◽  
Author(s):  
Feng Jiang ◽  
Kose John ◽  
C. Wei Li ◽  
Yiming Qian
Keyword(s):  
Corporate Culture ◽  
Credit Ratings ◽  
Explanatory Power ◽  
Bank Loans ◽  
Soft Information ◽  
Cost Of Debt ◽  
Private Debt ◽  
Public And Private ◽  
The Cost ◽  
The Impact

We document that a firm’s culture, specifically, its religiosity, affects its cost of debt. Firms in higher-religiosity counties have higher credit ratings and lower debt costs. The impact of religiosity is stronger for firms with greater information asymmetry and during recessions. Further, religiosity has additional explanatory power for the cost of bank loans (but not the cost of public bonds) beyond its impact through ratings. This supports the argument that banks have superior abilities in pricing soft information, such as corporate culture. Finally, the impact of religiosity is stronger when the lender is a small bank.

scholarly journals A World in the Balance: The Economy Towards Recession

2019 ◽  
Vol 11 (3) ◽  
pp. 50
Author(s):  
Giovanni Antonio COSSIGA
Keyword(s):  
Fiscal Policy ◽  
Global Economy ◽  
Central Banks ◽  
Large River ◽  
Sustainable Growth ◽  
Dark Side ◽  
Private Debt ◽  
Public And Private ◽  
Thing In Itself ◽  
Weak Growth

The global economy is moving uncertainly towards recession. An economy in the balance that remains uncertain on the threshold of recession, relying on the benevolent contribution of support policies. Without the help of fiscal policy and the complacency of the Central Banks through new liquidity injections, and therefore through easy credit, it can certainly be admitted that the recession would tend to prevail. But the recession is not a bad thing in itself, it’s rather the treatment for the evil afflicting the economy: the growing instability of economic systems under the increasing weight of excessive liquidity and an abnormal increase of public and private debt. The result of this negative equation is the growth of the economy sustained by abundant liquidity and credit availability and then a weak and doped development. A development line that cannot go on without the resources of politics. The problem is therefore whether this dependency condition can last. That is, if the economy can find the virtuous energies to reabsorb the accumulated excesses through a sustainable growth. The compulsive use of fiscal policy to fight the damage caused by the serious 2008-2010 crisis has undoubtedly reduced the economic and above all social damage due to the loss of jobs, and therefore helped the recovery. However, the massive use of public debt could hide a dark side. First of all, it fueled a legacy of recessive prices and weak development. And this, despite the large river of liquidity injected into the system by the Central Banks. However, the availability of new liquidity did not defeat the tendency of the economy to deflation and then couldn’t support development, which appears generally weak. The US case, which sees the relaunch of development by the fiscal reform that reduces taxation particularly in favor of higher incomes, doesn’t seem to be an exception. However, we are facing economies that require the continuous support of political policies in order to confirm their (weak) growth. On the other hand, it’s quite clear the dark side created by the trap "liquidity - weak growth" now affecting the global development, although without this trick the world in the balance could fall into recession.

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