Publication

In this study, the authors argue that sovereign debt is in crisis. The study concentrates on the tension between the need for the public sector to sustain demand in the face of a deleveraging private sector and the longer-term challenges for fiscal policy in the major developed economies of the world, namely the US, Japan and the euro area. The developed countries must find a way to navigate between the Scylla of insufficient stimulus for their weak economies and the Charybdis of excessive issuance of public debt.