Adverse demographics in Korea impinges on its growth potential and fiscal outlook. Accordingly, this study examines the current demographic situation and recent projections related to the impacts of population aging in Korea, particularly on the looming fiscal imbalance. The focal conclusion is...

The authors study the implications of fiscal policy behaviour for sovereign risk in a framework that determines a country's fiscal limit, the point at which, for economic or political reasons, taxes and spending can no longer adjust to stabilize debt. A real business cycle model maps the...