Public sector deficits and macroeconomic performance

Presents the findings of a Bank research project designed to shed light on the complex dynamics of public sector deficits. It includes case studies of eight countries - Argentina, Chile, Colombia, Cote d'Ivoire, Ghana, Morocco, Pakistan, and Zimbabwe, which are analysed within a theoretical framework elaborated for the study and in conjunction with cross-country data from a larger set. The book concludes that the way chosen to finance deficits (money creation, debt, or arrears) go far to explain medium-term financial and macroeconomic imbalances, but in the short term these relations are blurred. The link between inflation and budget deficits is found to be weak, at least for the countries studied. -after Publisher