Why Have Governments Succeeded in Reducing French Public Debt Historically and Can These Successes Inspired Us for the Future?: An Historical Perspective Since 1890

27 Pages Posted: 11 Jul 2012

See all articles by Gilles Dufrénot

Gilles Dufrénot

GREQAM and Aix-Marseille School of Economics

Karim Triki

Banque de France

Date Written: July 1, 2012

Abstract

The question of reducing public debt is at the heart of the current debates in France where the level of debt ratio amounted to 86% of the GDP in 2011. In this paper, we examine how the primary balance, the GDP growth rate, the real interest rate and the inflation rate have influenced the evolution of the debt ratio since the end of the 19th century. We use a methodology based on both historical and empirical analysis. Our aim is to explain why some years, the interest rate, the economic growth, the fiscal policy have helped in making public debt low, while they did not during other periods. Which historical events explained such differences? Our purpose is to think about scenarios of exit of the current French debt crisis making comparisons with the past.

Keywords: debt ratio, France, historical analysis

JEL Classification: H54, C4

Suggested Citation

Dufrénot, Gilles and Triki, Karim, Why Have Governments Succeeded in Reducing French Public Debt Historically and Can These Successes Inspired Us for the Future?: An Historical Perspective Since 1890 (July 1, 2012). Banque de France Working Paper No. 386, Available at SSRN: https://ssrn.com/abstract=2103516 or http://dx.doi.org/10.2139/ssrn.2103516

Gilles Dufrénot

GREQAM and Aix-Marseille School of Economics ( email )

Centre de la vieille Charité
2 rue de la Charité
13002 Marseille, 13236
France

Karim Triki (Contact Author)

Banque de France ( email )

Paris
France

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