Public Sector Deficits in Organization for Economic Cooperation and Development Countries

For many years in the postwar era debts grew at the same rate as the economy. The ratio between debt and GNP remained remarkably steady. From 1981-85, however, the ratio of debt to GNP rose about 20 base points. Although the United States has perhaps led the way as a debtor, the situation of other western country economies also causes concern. These papers state the causes and consequences of the deficits in OECD countries, and point out remedies. After an overview of the situation in OECD countries, each contributor writes about his own country: the USA, the UK, Germany, Italy and France.