Global fiscal consolidation

One important outcome of the Great Recession has been the rapid accumulation of government debt in many of the world’s developed economies. This growing debt burden represents a potential threat to economic stability, and as a result, the focus of fiscal policy is now shifting from stimulus to consolidation. In a new paper prepared for the 10th anniversary meeting of the Asian Economic Panel held in New York in March this year, Warwick McKibbin and Andrew Stoeckel examine the national and global consequences of fiscal consolidation.