Public Debt, Fiscal Consolidations and Non-Keynesian Effects

WANG Yi-ming ;CAI Chang-da

Journal of Central University of Finance & Economics ›› 2014, Vol. 1 ›› Issue (04) : 3.

PDF(493 KB)
PDF(493 KB)
Journal of Central University of Finance & Economics ›› 2014, Vol. 1 ›› Issue (04) : 3.

Public Debt, Fiscal Consolidations and Non-Keynesian Effects

Author information +
History +

Abstract

This paper shows that the impacts of fiscal policies may be reversed as public debt accumulates based on a theoretical model. Using the 1998-2010 panel data of China and GMM technique, we find that China exhibits traditional Keynesian behavior in the current period under fiscal consolidations but reveals modest non-Keynesian effect in next period. Based on above, this paper suggests that the debt levels of local governments are approaching the threshold and is calling for more attention to the delayed Non-Keynesian effect that may alter or even reverse the original intention of fiscal policies.

Key words

Size of Debt / Fiscal Consolidation / Non-Keynesian Effect / Expectation Mechanism

Cite this article

Download Citations
WANG Yi-ming ;CAI Chang-da. Public Debt, Fiscal Consolidations and Non-Keynesian Effects[J]. Journal of Central University of Finance & Economics, 2014, 1(04): 3
PDF(493 KB)

965

Accesses

0

Citation

Detail

Sections
Recommended

/