Since 2014
An Empirical Study on Public Debt's Determinants: Evidence from Romania
Transylvanian Review of Administrative Sciences
View Archive Info| Field | Value | |
| Title |
An Empirical Study on Public Debt's Determinants: Evidence from Romania
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| Creator |
PIRTEA, Marilen Gabriel; Professor, Finance Department, Faculty of Economics and Business Administration, West University of Timişoara, Timişoara, Romania NICOLESCU, Ana Cristina; Lecturer, Finance Department, Faculty of Economics and Business Administration and NIFIP, West University of Timişoara, Timişoara, Romania MOTA, Paulo R.; Assistant Professor, Finance Department School of Economics and Business and NIFIP, University of Porto, Portugal |
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| Subject |
public debt; sustainability; determinants; model.
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| Description |
The need for coordinating economic and budgetary policies in the Economic and Monetary Union, the awareness that pile of high public debt threatens future generations, increasing tax burden on a globalized market and the impact of population aging process on public finances has led to controversial opinions. Continuously borrowing resources and maintaining them consistently over time means to have a sustainable public debt, an important objective of any state fiscal policy. A sustainable public debt is the result of trade and monetary policy and budgetary decisions. The national debt is at the center of the current crisis of the Peripheral European countries. The objective of the paper is to provide a better understanding of public debt dynamics in Romania in the period 2000 to 2011. We decompose the changes in public debt to GDP ratio into macroeconomic components attributable to primary fiscal deficits, real interest rate, real GDP growth, and to the variations on foreign currency denominated debt. The research findings suggest that the reaction of the public debt to GDP ratio to the real growth rate of the output increased after the financial crisis. The real interest rate on government bonds remained a significant determinant of public debt in the entire sample period. Also, we find little effectiveness of monetary policy as an automatic stabilizer through the entire sample period.
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| Publisher |
Babes Bolyai University
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| Contributor |
This work was supported by the project “Post-Doctoral Studies in Economics: training program for elite researchers - SPODE” co-funded from the European Social Fund through the Development of Human Resources Operational Programme 2007-2013, contract no. PO
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| Date |
2013-02-01
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion Peer-reviewed Article |
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| Format |
application/pdf
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| Identifier |
http://rtsa.ro/tras/index.php/tras/article/view/117
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| Source |
Transylvanian Review of Administrative Sciences; 2013: Issue No. 38 E/February; 144-157
1842-2845 |
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| Language |
eng
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| Relation |
http://rtsa.ro/tras/index.php/tras/article/view/117/113
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| Rights |
Copyright (c) 2014 Transylvanian Review of Administrative Sciences
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