Public debt, government current account saving and primary surplus

Vol. 28 No. 4 (2008)

Oct-Dec / 2008
Published October 1, 2008
PDF-Portuguese (Português (Brasil))
PDF-Portuguese (Português (Brasil))

How to Cite

Silva, Alexandre Manoel Angelo da, and Manoel Carlos de Castro Pires. 2008. “Public Debt, Government Current Account Saving and Primary Surplus: An Analysis of Sustainability”. Brazilian Journal of Political Economy 28 (4):612-30. https://centrodeeconomiapolitica.org/repojs/index.php/journal/article/view/545.

Public debt, government current account saving and primary surplus

an analysis of sustainability

Alexandre Manoel Angelo da Silva
Técnico em Planejamento e Pesquisa do IPEA
Manoel Carlos de Castro Pires
Técnico em Planejamento e Pesquisa do IPEA
Brazilian Journal of Political Economy, Vol. 28 No. 4 (2008), Oct-Dec / 2008, Pages 612-630

Abstract

On this paper, we propose a change in the primary surplus’ target by the government current account saving. That concept excludes public investment from primary surplus. However, of that change has raised a question about if government current account saving represents a sustainable fiscal policy. Thus, this paper analyses if the change in the primary surplus’ target by the government current account saving implies a meaning modification on the debt-to-GDP ratio path. The empirical analysis, which is based on Brazilian monthly data for the period 1999-2005, suggests that the change in fiscal target does not mean a lack of sustainability.

JEL Classification: H62; H63; H69.


Keywords: primary surplus debt-to-GDP ratio government current account saving