Working Paper: NBER ID: w21821
Authors: Alberto Alesina; Andrea Passalacqua
Abstract: This paper critically reviews the literature which explains why and under which circumstances governments accumulate more debt than it would be consistent with optimal fiscal policy. We also discuss numerical rules or institutional designs which might lead to a moderation of these distortions.
Keywords: No keywords provided
JEL Codes: E62
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| political factors (P16) | government debt accumulation (H63) |
| democracies (D72) | suboptimal fiscal policies (E62) |
| political distortions (D72) | persistent deficits (H62) |
| political distortions (D72) | debt accumulation (H63) |
| political institutions (D02) | fiscal outcomes (H68) |
| fiscal rules (E62) | excessive deficits (H62) |
| political budget cycles (H61) | government debt (H63) |
| political competition (D72) | fiscal policy decisions (E62) |
| institutional arrangements (D02) | government debt levels (H63) |