Sovereign Debt

Vani Borooah

Chapter 4 in Europe in an Age of Austerity, 2014, pp 60-96 from Palgrave Macmillan

Abstract: Abstract The economist Paul Krugman claimed, in the New York Times , that “when people [in Washington, DC] talk about deficits and debt, by and large they have no idea what they’re talking about – and people who talk the most understand the least”. 1 Krugman’s ire was directed particularly against those who regarded the debt of sovereign governments (hereafter, sovereign debt or, equivalently, public debt, or government debt) as no different from the debt owed by households. As with households who have difficulty repaying a loan that is too large relative to their income, so with governments – “deficit worriers portray a future in which we are impoverished by the need to pay back money we’ve been borrowing”.

Keywords: European Union; Gross Domestic Product; Euro Area; European Central Bank; European Monetary Union (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-39602-0_4

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DOI: 10.1057/9781137396020_4

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