Brazil has had a long period of high inflation. It peaked around 100 percent per year in 1964, decreased until the first oil shock (1973), but accelerated again afterward, reaching levels above 100 percent on average between 1980 and 1994. This last period coincided with severe balance of...

"This paper relaxes some key assumptions in the probabilistic approach to fiscal sustainability. First, the authors identify structural breaks over the sample period used to estimate the covariance matrix of the shocks to the debt ratios. Second, the assumption of normality of the shocks is...

This paper deals with the role of the public debt on the transmission mechanism of monetary policy. An IS function where the Ricardian Equivalence does not prevail and Phillips curve are estimated by full information maximum likelihood (FIML), General Method of Moments (GMM) and bootstrap...

In this paper we investigate the real effects of fiscal policy in Brazil during the 1995-2008 period by estimating a VAR model that explicitly takes into consideration the role of public debt in the determination of fiscal variables, as recommended by Favero and Giavazzi (2007). According to our...