Debt Sustainability Assessment: Mission Impossible

Abstract

Debt sustainability is a vexing issue. Its importance is immediately obvious but it escapes any easy definition. This situation is not unheard of in economics; price stability and full employment are examples of other crucially important policy objectives that cannot be simply defined. Yet, while price stability or full employment can both be measured with a reasonable degree of precision, debt sustainability cannot even be measured directly.

Keyword(s): public debts, budget balance, sustainability
Subject classification: E43, E62, E37