Economic implications from deficit finance

Stevan Gaber

No 69, BERG Working Paper Series from Bamberg University, Bamberg Economic Research Group

Abstract: The paper enlightens popular part of the budget policy - deficit finance. In the process of securing economic conditions to surpass the current economic crises, the governments all over the world incline towards debt deficit finance. The intention is to describe the implications such as multiplier effect, crowding out effect, correlation between budget and trade deficit. One of them are positive, they increase the aggregate demand and national income, other negative in term that they crowd out the private sector from the capital market under increased demand for loanable funds.

Keywords: Budget deficit; Crowding out; Twin deficits; Exchange rates (search for similar items in EconPapers)
JEL-codes: H30 H62 H63 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-pub
References: View complete reference list from CitEc
Citations: View citations in EconPapers (20)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bamber:69

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