<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Implicit public debt is a calculation based on assumptions that are qualitatively and fundamentally different from explicit public debt, i.e. it cannot be added to the latter. Moreover, they distort the real costs of ageing considerably. This creates a mirage of public debt that drives fiscal policy in the wrong direction like a will-o’-the-wisp. The costs of demographic change are systematically overestimated.</p>
</abstract>

Implicit public debt is a calculation based on assumptions that are qualitatively and fundamentally different from explicit public debt, i.e. it cannot be added to the latter. Moreover, they distort the real costs of ageing considerably. This creates a mirage of public debt that drives fiscal policy in the wrong direction like a will-o’-the-wisp. The costs of demographic change are systematically overestimated.

Debt Sustainability with Implicit Government Debt - Guiding Principle or Will-O’-The-Wisp?

Wirtschaftsdienst

This work is licensed under the Creative Commons Attribution 4.0 International License.

Schuldentragfähigkeit mit impliziten Staatsschulden – Leitbild oder Irrlicht?

Implicit public debt is a calculation based on assumptions that are qualitatively and fundamentally different from explicit public debt, i.e. it cannot be...

Debt Sustainability with Implicit Government Debt - Guiding Principle or Will-O’-The-Wisp?

Published Online: Mar 27, 2023

Page range: 198 - 204

DOI: https://doi.org/10.2478/wd-2023-0053

© 2023 Jan Priewe, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.