An Overview of Fiscal and Public Debt Dynamics

Panel evidence of fiscal policy impact on inflation, 1950-2019 Impulse response of 1% of GDP rise in government spending on inflation; - Bayesian Panel VAR encompassing 17 advanced countries, 1950-2019 (dotted lines show the 90% confidence bands) - Percentage points 1950-1985 1.5 1.3 1.1 0.9 0.7 1.5 1.3 0.5 0.3 0.1 -0.1 Percentage points 1.1 0.9 0.7 0.5 0.3 0.1 -0.1 -0.3 -0.5 -0.3 -0.5 1 2 3 4 5 6 7 8 9 10 11 12 Years (Source) IMF, 2023, Fiscal Monitor April 2023, Figure 2.9. 1986-2019 1 2 3 4 5 6 7 8 9 10 11 12 Years 10

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