Sustainable debt ratios: How would 'stabilized values' look like?
نویسنده
چکیده
Following Burger (2012)'s approach of calculating stabilized debt to GDP ratios this paper computes these levels for ve selected Eurozone economies. Such a debt ratio indicates to which level the economy would converge to, based on its past country-speci c behavior in combination with the scal response mechanism. The outcome shows that for most of the selected economies the current (to some extent crisis-induced) debt to GDP ratios are above the stabilized ones. This development requires scal counter-steering. Such a policy is also recommendable for the other two economies, i.e. Italy and the Netherlands, since their debt ratios reveal an increasing tendency.
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