ANALYSIS OF THE NATURE OF GOVERNMENT DEBT WITHIN THE CONTEXT OF LERNER’S AND KRUGMAN’S VIEWS

Abstract

The problem of the government dept of tremendous amount has been affecting economies around the world for several decades. Drawing upon Lerner’s and Krugman’s research studies, this paper shows the mutual relations between and entwinement of the views of foremost economists of XX and XXI centuries. In this paper, the fact that government debt and indebtedness do not impend over financial stability under the conditions of sustainable economic growth outpacing the increment load of national debt is established. Moreover, it is mandatory to merely conduct debt servicing and refinancing instead of making full repayment. Additionally, the success of debt management depends on the ability to maintain sustainable economic growth