Government consumption, foreign interest and repressed investment: the problem of external debt revisited

Fábio Giambiagi () and José Carlos Gomes Soares ()

Brazilian Journal of Political Economy, 1992, vol. 12, issue 3, 344-359

Abstract: This paper analyses the evolution of Brazilian public sector expenditures duringthe second half of the 1980’s. The interpretation according to which the fiscal crisis isexogenous and caused by the external debt interest is criticized. The great increase in currentexpenditures after 1984, together with a budget restriction that limited public investment isdiscussed. Based on it, public sector consumption and not external debt interest payments isconsidered the most important factor responsible for the public investment trajectory overtime during the last five years. JEL Classification: F31; F34; H63.

Keywords: Public expenditure; currency crisis; debt crisis (search for similar items in EconPapers)
Date: 1992
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Persistent link: https://EconPapers.repec.org/RePEc:ekm:repojs:v:12:y:1992:i:3:p:344-359:id:1423

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