dependent on the steady-state debt-to-GDP ratio and thus determines the cutoff point beyond which debt is non-stationary. We … this regime, the lower the steady state debt-to-GDP ratio must be. This has repercussions for the overall business cycle …, implying a higher volatility of inflation and output the longer fiscal policy is active for any given equilibrium debt-to-GDP …

debt above 60 percent or deficits above 3 percent of GDP. We find that the proposed framework would require ambitious … fiscal adjustment: on average, more than 2 percent of GDP over the medium term, in addition to the adjustment that is already … framework. We also find that for most countries with debt above 60 percent of GDP, these adjustment requirements are driven by …