## Fiscal Deficit and Public Debt in Industrial Countries, 1970-1994

_IMF Working Papers, May 1, 1995_

## Source details

**Canonical URL:** [Fiscal Deficit and Public Debt in Industrial Countries, 1970-1994](https://www.imf.org/en/publications/wp/issues/2016/12/30/fiscal-deficit-and-public-debt-in-industrial-countries-1970-1994-1131)

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## Bibliographic details
- Authors: Domenico Fanizza, Vito Tanzi
- Published: May 1, 1995
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451846782.001

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### Overview
- Paper assembles fiscal data for individual countries and for the aggregate G-7 and 18 industrial countries covering a period long enough to assess trends and conduct econometric tests.
- The “world” fiscal deficit has been rising since the 1970s and reached a historic high in 1993-94.
- The rise of the deficit has been accompanied by a significant decline in world saving.
- The paper argues that the increase in public debt, which has been the consequence of the accumulation of the fiscal deficits, has pushed up worldwide interest rates.
- Econometric evidence supporting this relationship is presented on the basis of panel data for the period 1970-93.

### Key findings and evidence
- The “world” fiscal deficit: rising since the 1970s; historic high in 1993-94.
- World saving: experienced a significant decline concurrent with rising deficits.
- Public debt accumulation: presented as the consequence of accumulated fiscal deficits.
- Interest rates: increase in public debt has pushed up worldwide interest rates.
- Empirical approach: econometric evidence based on panel data for the period 1970-93.

### Data coverage and scope
- Coverage: individual countries plus aggregate G-7 and 18 industrial countries.
- Time span emphasized: 1970-1994 for assembled fiscal data; econometric analysis based on 1970-93 panel data.

### Subjects and keywords (as listed)
- Subjects: Expenditure, Financial services, Government debt management, Long term interest rates, National accounts, Private savings, Public debt, Public financial management (PFM), Real interest rates
- Keywords: countries GPS, debt coefficient, debt dynamic, deficit, deficit country, G-7, GDP ratio, Global, Government debt management, percentage of GDP, Private savings, Real interest rates, WP

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/30/fiscal-deficit-and-public-debt-in-industrial-countries-1970-1994-1131_