01905cas a2200253 a 4500 AALejournalIMF015318 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513591353 1018-5941 BD-DhAAL BD-DhAAL Anaya, Pablo. What Really Drives Public Debt : A Holistic Approach / Pablo Anaya, Alex Pienkowski. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (25 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper presents a novel approach to detail the propagation of shocks to public debt. The modeling technique involves a structural vector auto-regression (SVAR) estimator with an endogenous debt accumulation equation. It explores how the main drivers of sovereign debt dynamics-the primary balance, the interest rate, growth and inflation-interact with each other. Such analysis is particularly useful for debt sustainability analysis. We find that some interactions exacerbate the impact of shocks to the accumulation of debt, while others act to stabilize debt dynamics. Furthermore, the choice of monetary policy regime plays an important role in these debt dynamics - countries with constrained monetary policy are more at risk from changes in market sentiment and must rely much more on fiscal policy to constrain debt. Mode of access: Internet Pienkowski, Alex. IMF Working Papers; Working Paper ; No. 2015/137 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/137/001.2015.issue-137-en.xml IMF e-Library