Studies on Fiscal Policy in Times of High Debt

A special issue of Economies (ISSN 2227-7099). This special issue belongs to the section "Macroeconomics, Monetary Economics, and Financial Markets".

Deadline for manuscript submissions: 28 February 2026 | Viewed by 872

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Guest Editor
Faculty of Economics, Constantin Brancusi University of Targu Jiu, Targu Jiu, Romania
Interests: economic growth; fiscal policy; business environment; marking; circular economy
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Special Issue Information

Dear Colleagues,

Fiscal policy plays a crucial role in addressing the economic challenges posed by high debt levels, a pressing issue in today’s global economy. The sustainability of public finances, economic stability, and social equity are shaped by factors such as fiscal rules, debt management strategies, the effectiveness of taxation systems, public expenditure efficiency, and institutional frameworks. Moreover, the impact of fiscal policy may vary depending on a country’s economic, political, and social context, as well as external influences, such as global financial conditions, geopolitical tensions, and climate risks.

This Special Issue aims to deepen understanding of fiscal policy in high-debt environments, offering innovative approaches to balancing economic growth with debt sustainability. Some topics for this Special Issue, though not limited to these, include the design and effectiveness of fiscal rules, the role of fiscal multipliers in indebted economies, strategies for public debt management and reduction, the interplay between fiscal and monetary policies, the distributional effects of fiscal measures, and the challenges of financing sustainable public investments during periods of fiscal stress. Additionally, research on fiscal consolidation, cross-country comparative studies, and the implications of global economic trends is welcome, providing valuable insights for policymakers, academics, and researchers. Papers may be theoretical or empirical, employing approaches such as case studies, comparative analyses, theoretical frameworks, or empirical investigations, among others.

Prof. Dr. Gabriela Dobrotă
Guest Editor

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Keywords

  • fiscal policy
  • debt sustainability
  • debt crisis
  • fiscal consolidation
  • public debt management
  • budget deficit
  • macroeconomic stability

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Published Papers (1 paper)

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Research

22 pages, 1304 KiB  
Article
How Harmful Is a High Share of Public Expenditure in GDP?
by Séverine Menguy
Economies 2025, 13(3), 74; https://doi.org/10.3390/economies13030074 - 13 Mar 2025
Viewed by 700
Abstract
We aim to analyze the potential positive or negative effects of public expenditure on economic growth, as well as their determinants. To this goal, we use a simple theoretical model, which has the specificity to distinguish between public investment and consumption expenditure, and [...] Read more.
We aim to analyze the potential positive or negative effects of public expenditure on economic growth, as well as their determinants. To this goal, we use a simple theoretical model, which has the specificity to distinguish between public investment and consumption expenditure, and which could be applied to a wide range of developed or developing countries. Regarding public spending, we find that public consumption expenditure usually harms global economic growth, whereas public investment expenditure benefits economic activity: it can increase income per head, provided real returns on capital are not too small. We can also theoretically underline the existence of an inverted U-shaped relation between the variation of public investment or consumption expenditure and economic growth. An increase in public spending would benefit economic growth only up to a maximal variation, which positively depends on real capital returns, but negatively depends on the capitalization of the economy. Regarding fiscal resources, we find that increasing the consumption taxation rate and the share of fiscal resources collected through consumption taxes could benefit global economic growth, even if it is detrimental to private consumption. Full article
(This article belongs to the Special Issue Studies on Fiscal Policy in Times of High Debt)
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