The Persistency of Public Debt

Felix Rösel
Authors registered in the RePEc Author Service: Felix Roesel

VfS Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association

Abstract: This paper shows that geographic patterns in public debt can be highly persistent despite drastic external shocks. I compare pre-Nazi debt in 60 districts and 132 large cities of the German Reich with current local government debt. German local government debt completely defaulted after WWII. I find that 1932 and 2012 debt is highly correlated in cities which saw a re-installation of their pre-Nazi mayor by the Allies in 1945. Comparable cities without personnel continuity do not exhibit a robust correlation. Intertemporal personnel links thus constitute a main channel through which to explain long-term persistency in public finance.

JEL-codes: H63 H74 N94 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-his
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc16:145595

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