Abstract

The phenomenon of substantial peacetime budget deficits over the past20 years has been traced to the burden of entitlements, a slowdown ineconomic productivity, and demographic and macroeconomic shifts in theindustrial countries. Though smaller and structurally different, deficitsin developing countries have also become worrisome. Most economists agreethat measures to reduce government spending are imperative, particularlythrough restructuring entitlement programs.

© 1996 International Monetary Fund

ISBN: 9781557756152

Published September 1996

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Preface

The Economic Issues series was inaugurated in September 1996. Its aim is to make some of the economic research being produced in the International Monetary Fund on topical issues accessible to a broad readership of nonspecialists. The raw material of the series is drawn mainly from IMF Working Papers, technical papers produced by Fund staff members and visiting scholars, as well as from policyrelated research papers. This material is refined for the general readership by editing and partial redrafting.

The following paper, prepared by Rozlyn Coleman, draws on material originally contained in IMF Working Paper 95/128, “Long- Term Tendencies in Budget Deficits and Debt,” by Paul R. Masson and Michael Mussa. Readers interested in the original Working Paper may purchase a copy from IMF Publication Services.

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