This paper formulates a model of countercyclical use of long-term full faith and credit debt by subnational governments to finance infrastructure. The model incorporates long-term debt into budgetary policy, considering debt capacity, purposes and security of debt, and equity. The proposition is...

Deficits and debts are very complex issues for eternal public debate. The norm of budget balance - whether as a value judgment or ideal, as a political symbol or as a budgetary principle - often appears in literature and public debate over federal budgetary and fiscal policies. This paper offers...