CEU Electronic Theses and Dissertations, 2014
| Author | Nagy, Réka |
|---|---|
| Title | Public Debt Accumulation in Hungary Outlier in what sense? |
| Summary | Exclusively looking at the last decade of public debt accumulation in European member states it seems Hungary with its increasing debt ratio before the crisis and downward trends afterwards is an absolute outlier within its region and also diverges from dominant European trends. This thesis examines whether Hungary is an outlier once the covered time period is extended, and how can we best describe with a general economic model the differences within Europe when it comes to fiscal overspending and public debt accumulation. Building on the theoretical models of Barro, Alesina and Battaglini, this study uses a time-series panel data analysis on EU member states to examine the explanatory power of different empirical models to describe the trends of public debt accumulation and the role of political distortions within this process. The statistical analysis has found strong evidence that those empirical models, which controls for the interaction effects between political distortions and the general state of the economy have more explanatory power in describing long-term public debt trends. Since the analysis has found no specific country effect in Hungary, therefore the unique features in the last decade could be attributed more to the specificity of the Hungarian political systems, its higher initial debt rate inherited from the socialism and a time lag its natural long-term cycles of public debt accumulation compared to other countries in the region. |
| Supervisor | Folsz, Attila |
| Department | Political Science MA |
| Full text | https://www.etd.ceu.edu/2014/nagy_reka.pdf |
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