Limitations of the Government Budget Constraint: Users vs. Issuers of the Currency

Stephanie Kelton ()

Panoeconomicus, 2011, vol. 58, issue 1, 57-66

Abstract: The financial crisis and ensuing economic meltdown has led to sharp increases in the deficits and debt levels of many advanced economies. The run-up in public sector indebtedness helped to restore private sector balance sheets, laying the foundation for economic recovery in these regions. But the so-called “sovereign” debt crisis in the Eurozone has undermined the fiscal resolve that has, thus far, kept truly sovereign governments from slipping into a bona fide depression. Fearful of becoming the next Greece, governments that could allow an unlimited fiscal adjustment to restore full employment, are methodically weakening their fiscal support mechanisms and setting themselves on a path to becoming the next Japan. Key words: Fiscal policy, Deficit, Sovereign risk.JEL: E62, H62, F34.

Keywords: Fiscal policy; Deficit; Sovereign risk (search for similar items in EconPapers)
Date: 2011
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://panoeconomicus.org/index.php/jorunal/article/view/142/136 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:voj:journl:v:58:y:2011:i:1:p:57-66:id:142

Access Statistics for this article

Panoeconomicus is currently edited by Kosta Josifidis

More articles in Panoeconomicus from Savez ekonomista Vojvodine, Novi Sad, Serbia
Bibliographic data for series maintained by Savez ekonomista Vojvodine, Novi Sad, Serbia ().