in the risk balance throughout our evaluation period because of the implied amplification of deflation risks. We then …

forecast the risks of worldwide deflation for horizons of up to two years. Although recently fears of worldwide deflation have … increased, we find that, as of September 2002, with the exception of Japan there is no evidence of substantial deflation risks …. We also put the estimates of deflation risk for the United States, Germany and Japan into historical perspective. We find …

., 2007). We model fiscal consolidation as a permanent reduction in the targeted government debt-to-output ratio and analyse …