The paper represents an attempt to determine the level of fiscal deficit which does not require more financing than is compatible with sustainable internal and external borrowing, and which is consistent with the expected and desirable levels of macroeconomic indicators, such as economic growth and the rate of inflation. At the same time it takes into account the existing foreign trade potentia...

This paper is motivated by an important puzzle that arises from the contrasting macroeconomic experience across developing regions in the recent decades. In sharp contrast to East Asia, the fiscal policies in much of Latin America and sub-Saharan Africa are characterized by large fiscal deficits and volatilities of fiscal outcomes. In order to address both large deficits and volatile fiscal out...

Well before the global financial crisis, the stance of fiscal policy in a number of countries had raised concerns about risks for the outcomes of monetary policy. To provide some insights this paper examines the fiscal-monetary interactions in a novel game theory framework with asynchronous timing of moves. It generalizes the standard commitment concept of Stackelberg leadership by making it dy...

The aim of this paper is to analyse some macroeconomic channels operating in a war economy. At the theoretical level, the effects of such war on the key economic variables capital, technology, uncertainty, and the government’s fiscal deficit are discussed before proceeding to the analysis of individuals, firms and the government. These elements are combined in a dynamic macroeconomic model to s...

The Economic Community of West African States launched the name its proposed currency, eco, in June, 2019 for monetary union. Regional body stipulated certain convergence criteria to be met before member countries could admitted One such is that budget deficit-to-Gross domestic product ratio less than or equal three percent. Available data past two decades indicate non-compliance many these thi...

In the United States, eradication of persistent federal deficits has won broad bipartisan support. At the same time, political pressures have mounted to strengthen the Federal Reserve's explicit concern with price stability. Proposals under consideration would require a much narrower focus on the part of Fed policymakers, and could be interpreted as targeting the price level rather than a negli...

The Government of India needs to take some hard decisions in the upcoming Union Budget for 2000-01. There are several reasons why it is important to do so right now. India's political system is more than ever in consensus about the basic direction of reforms. The current government enjoys a strong electoral mandate. This is the first year in office for this government, and is, therefore, the mo...