This paper examines debt dynamics in the Caribbean and discusses policy options for reducing the high debt levels. Based on empirical studies of factors underlying global large debt reduction episodes, important policy lessons are drawn for the Caribbean. The analysis shows that major debt...

The sharp increase in debt in the Caribbean since the mid-1990s has focused attention on the conduct of fiscal policy in the region. This paper aims to diagnose how fiscal policy has behaved during this period by looking at three main cycles of the economy: the business, election, and natural...

The paper presents a model of fiscal dominance with borrowing constraints, and provides evidence for a large number of sub-Saharan African countries on the relative importance of fiscal and monetary determinants of inflation. Based on the dynamic response of inflation to different shocks,...

This paper argues case that a tighter fiscal policy stance can meaningfully support central banks in fighting inflation in both advanced and emerging market economies. While the standard textbook result suggest that monetary policy is much more effective than fiscal policy in battling inflation...

Implementation of fiscal consolidation by advanced economies in coming years needs to take into account the short and long-run interactions between economic growth and fiscal policy. Many countries must reduce high public debt to GDP ratios that penalize longterm growth. However, fiscal...

The recent relatively high levels of global oil prices have led to a significant improvement in the public finances of several hydrocarbon-exporting countries. However, despite the increase in fiscal buffers, medium-term risks remain high. Fiscal vulnerabilities have increased as a consequence...

Intro -- Contents -- I. INTRODUCTION -- II. KEY FEATURES OF THE GLOBAL FISCAL MODEL -- III. CALIBRATING THE MODEL -- IV. THE MACROECONOMIC EFFECTS OF GOVERNMENT DEBT -- V. GOVERNMENT SPENDING SHOCKS AND PRIVATE CONSUMPTION -- VI. TAX DISTORTIONS AND THE BENEFITS OF TAX REFORM -- VII. THE EFFECTS...

Intro -- Contents -- I. INTRODUCTION -- II. DEBT SUSTAINABILITY ANALYSIS AND RISK -- III. DEBT DYNAMICS AND THE CONDUCT OF FISCAL POLICY -- IV. RISKS TO DEBT SUSTAINABILITY IN FIVE EMERGING MARKET ECONOMIES -- V. CONCLUSION -- Appendix -- REFERENCES.