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This paper assesses the effects of fiscal consolidations associated with public debt reduction on medium-term output growth during periods of private debt deleveraging. The analysis covers 107 countries and 79 episodes of public debt reduction driven by discretionary fiscal adjustments during...
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Economics literature suggests that, even in the absence of fiscal costs, a persistently high and increasing public debt ratio may have a detrimental effect on long run economic growth in an economy that is not over-accumulating capital like Finland today. High public debt creates expectations...
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This study finds that equity returns in the banking sector in the wake of the Great Recession and the European sovereign debt crisis have been driven mainly by weak growth prospects and heightened sovereign risk and to a lesser extent, by deteriorating funding conditions and investor sentiment....
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measurement and identification problems. To address these drawbacks, we examine the impact of default on growth by looking at …. Moreover, we find that the trough of the contraction coincides with the quarter of default, and that output starts to grow … thereafter, indicating that default episode, rather than a further decline, seems to mark the beginning of the economic recovery …
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