This paper shows that the rules established to control state and municipal debt in Brazil are inefficient. They cannot prevent the excessive growth of the debt nor avoid the approval of loans that have a negative benefit-cost relation. The paper uses theoretical models to show that the federal...

Die Landesregierung hat die "schwarze Null" zur Leitlinie der Finanzpolitik erklärt. Sowohl im laufenden Jahr wie auch 2019 soll es zu keiner weiteren Netto-Kreditaufnahme kommen. 2019 sollen die Tilgungen die Kreditaufnahme um 30 Millionen Euro übersteigen. Die aktuell günstige...

The 'market discipline' approach to subnational finance requires that moral hazard derived from the possibility of a central government bailout be made insignificantly small. Therefore, governments interested in following this approach and willing to abide by its rules should start by creating...