Dinâmica não-linear e sustentabilidade da dívida pública brasileira

Abstract

This paper contributes to the debate on whether the Brazilian public debt is sustainable or not in the long run by considering threshold effects on the Brazilian Budget Deficit. Using data from 1947 to 1999 and a threshold autoregressive model, we find evidence of delays in fiscal stabilization. In particular, our results suggest that, only when the increase in the budget deficit reaches 1.7% of the GDP, will fiscal authorities intervene to guarantee that public debt will be sustainable in the long run. If seignorage is accounted for, the threshold increases to 2.2%, suggesting that seignorage makes government more tolerant to fiscal imbalances.