The IMF has just published chapters 3 and 4 of the October 2012 World Economic Outlook Report, titled “Coping with High Debt and Sluggish Growth”.
Chapter 3, “The Good, the Bad, and the Ugly: 100 Years of Dealing with Public Debt Overhangs,” analyzes how throughout the past century, numerous advanced economies have faced public debt burdens as high, or higher, than those prevailing today. The research concludes that the first priority today must be to complement fiscal consolidation with measures to support growth, especially, very accommodative monetary policy and structural reforms.
Chapter 4, “Resilience in Emerging Market and Developing Economies: Will It Last?,”. Many emerging market and developing economies have done well over the past decade and through the global financial crisis, but the question on policymakers’ minds now is whether this strong performance will last. There are reasons for optimism, including improved policymaking and greater “policy space”—room to respond to shocks without undermining sustainability.
Access Chapter 3 here.
Access Chapter 4 here.