Business and Economics Journal

Ernst & Young LLP, Golf View Corporate Tower B, Gurugram, India

Publications

• Review Article   
  Revisiting Fiscal Responsibility Norms: A Cross Country Analysis of the Impact of Covid-19
  Author(s): Dinesh Kumar Srivastava, Muralikrishna Bharadwaj*, Tarrung Kapur and Ragini Trehan
  
  In this paper, we have reviewed the COVID induced shock to the debt and deficit profiles of 10 of the largest economies by size of GDP in 2019 referred to in this paper as the Big-10 economies. There is a sharp upsurge in their government debt-GDP ratios because their policy responses to the COVID induced recession have been large fiscal stimuli based on borrowing. With low and often negative growth rates and high fiscal deficit, the debt-GDP ratios are projected to rise sharply in these economies. As normalcy is restored, these countries may attempt to sharply reduce their borrowing levels relative to GDP. However, we argue that before this is done, individual countries may do well to reassess their sustainability norms whether cast in terms of agreements such as the Maastricht Treaty or country level Fiscal Responsibility Legislations (FRLs) or other similar norms. This revision is .. Read More»
  DOI: 10.37421/2151-6219.2021.12.370

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