Debt Indicators Research Articles

MONITORING OF KEY INDICATORS OF THE STATE DEBT OF UKRAINE: MODERN TRENDS

The article contains a theoretical generalization of the essence and necessity of state borrowing, monitoring of indicators of state and state-guaranteed debt in the conditions of government aspirations and actions in the field of ensuring the sustainability of public finances in Ukraine. The main task of the authors is to monitor the indicators of state and state-guaranteed debt in the context of the need to ensure the sustainability of pub- lic finances of Ukraine. State debt in Ukraine remains a significant factor of macro-financial risk. An important measure to prevent the threat of uncontrolled growth of public debt is to strengthen financial control and the implementation of continuous monitor- ing of its main indicators. The cost of public borrowing and the assessment of the effectiveness of their use as a factor in ensuring the sustainable development of the economy is a constant source of discussion between officials, public organizations, and representatives of scientific analysis centers. The article uses the generally accepted methodology for calculating the main indicators characterizing the state’s debt policy. The method of expert assessments analyzes the condition of the state debt and prospects of its servicing in Ukraine. Statis- tical and analytical methods have been used for the processing of statistical data on the study of the dynamics of indicators of state and state-guaranteed debt in Ukraine. The sources of information were the materials of the Ministry of Finance of Ukraine, the State Treasury Service of Ukraine, as well as the Budget Code of Ukraine, laws and regulations of Ukraine relating to the budget sphere, scientific works of domestic and foreign scientists. This study aims to address the issues of analyzing and evaluating pub- lic debt indicators in the context of improving debt management. The authors propose to use 10 indicators to monitor the state of public debt and make managerial decisions in public finance.

Ідентифікація макрофінансових показників у сфері управління державними фінансами

Зосереджено увагу на особливостях аналізу макрофінансових показників у сфері управління державними фінансами. Наголошено, що ефективність податкового регулювання залежить від значного числа інтересів та факторів і визначається використанням відповідних макрофінансових індикаторів, які потрібні для комплексного аналізу і вибору сценаріїв досягнення стратегічних цілей. Показано важливість розмежування макрофінансової та макроекономічної сфер. Макрофінансовими індикаторами визначено доходи та видатки зведеного бюджету, державний борг, показники грошово-кредитної сфери. Оскільки управління є безперервним циклічним процесом, протягом циклу індикатори використовуються двічі: для оцінки ситуації під час планування заходів та оцінки наслідків їх впровадження. Визначено, що індикатори податкової сфери також включають у групу макрофінансової безпеки як складову структури доходів бюджету. Показники податкового навантаження на макрорівні відображають ефективність податкової політики, тобто кількісно вимірюють сукупний вплив податкових платежів на джерела їхньої сплати. При цьому потрібно розрізняти податкове навантаження сплачене та несплачене, тобто податкові борги та борги до цільових фондів. З'ясовано, що податковий коефіцієнт є найпростішим показником для використання у характеристиці податкового навантаження та його впливу на макропараметри. З погляду аналізу макрофінансової стабільності, відношення податкових надходжень до ВВП дає достатньо підстав для формування висновків щодо довготермінових тенденцій наповнення бюджету та виявлення потенційних ризиків. Однак надходження податків не є індикатором, пов'язаним з рівнем економічного розвитку. Обґрунтовано, що рівень несплати податкових зобов'язань, рівень тінізації економіки є відображенням реальної макрофінансової стабільності.

Debt policy in the economic transformation

Relevance of the research topic. In the context of transformation changes, it is important to identify the priority areas of debt policy as an instrument of socio-economic development of the country, the introduction of effective instruments for managing public debt in the institutional environment. Quite important is the study on the efficiency of debt policy. Formulation of the problem. In modern conditions, during the period of financial globalization, public debt is an integral part of the financial systems of most countries of the world. Particularly important are the priorities of debt policy for countries with a transformational economy, because they need to allocate a significant amount of financial resources to carry out and achieve effective results of reforms. It is important to develop and implement a coherent debt strategy, as well as to correct it for solving current problems. Analysis of recent research and publications. The issue of debt policy of the state is quite relevant today for the majority of countries of the world and are common in scientific works of the well-known foreign and domestic scientists. The following foreign scientists have made a significant contribution to the study of public debt and debt policy: R. Barro, D. Buchanan, A. Wagner, J. Keynes, D. Ricardo, P. Samuelson, J. Stiglitz, W. Thompson, F. Friedman and others. The theoretical and practical questions concerning the formation, management and maintenance of public debt under conditions of transformational changes in the economy are devoted to the work of such Ukrainian scientists as O. Vasylyk, I. Zapatrina, L. Lisyak, I. Lukianenko, A. Mazaraki, M. Pasichnyi, V. Fedosov, I. Chugunov and others. Selection of unexplored parts of the general problem. However, there are a number of underdeveloped issues related to the formation and repayment of public debt in the context of the transformation of the economy in both the medium and long-term periods. Setting the task, the purpose of the study. The research objective is to analyze the state debt of Ukraine as a result of the implementation of debt policy. The purpose of the study is to determine the main tasks of the debt policy of Ukraine. Method or methodology for conducting research. The combination of research methods were used in writing the article: systematic approach, statistical analysis, structuring, analysis and synthesis, and others. Presentation of the main material (results of work). Indicators of state and state-guaranteed debt in terms of repayment currencies, the structure of domestic government loans that were raised to the budget by placing bonds on the primary market were analyzed in the article. The priority tasks of the debt policy in the medium and long-term perspective were proposed. The field of application of results. The results of this study can be applied in the process of formation and implementation of Ukraine's debt policy. Conclusions according to the article. At the present stage of economic development it is important to increase the impact of the use of debt management methods based on the formation of the debt policy priorities for the medium and long term persrective. In carrying out an effective debt policy, the government should reduce the spread of crisis phenomena and debt risks, as well as reduce the total debt burden on the economy. The article defines the priority tasks of Ukraine's debt policy in the medium term.

The public debt of Ukraine as a particular factor of the state security

Relevance of research topic. The constant growth of Ukraine's public debt requires effective management of it. The larger the amount of debt, the harder it is to serve the state, so this topic is especially relevant in the context of those economic situations in which Ukraine has been during the recent years of the hybrid war with Russia and the protracted financial crisis. Formulation of the problem. The social and economic significance of public debt is increasing every year, because it is linked to the country's debt security, which affects the budget capacity of the state. The problem is the search of ways to improve the mechanism of public debt management in the direction of strengthening Ukraine's debt security, which since independence has been living at the expense of IMF loans. Analysis of recent research and publications. The theoretical foundations of state debt and debt security, methodological approaches to its evaluation, the formation of a mechanism for providing debt security and its management were highlighted in the works of O. Baranovsky, D. Boyko, Z. Varnaliy, V. Kozyuk, M. Kubai, O. Cheberyako and other scientists. Selection of unexplored parts of the general problem. Despite the rather deep theoretical study of the issue of debt security of the state, it should be noted that there is a need for its further study taking into account the specifics of the national economic situation and the strategic course of Ukraine on European integration. Setting the task, the purpose of the study. The purpose of the article is to study the state of debt security in Ukraine by analyzing the dynamics of public debt and developing recommendations for raising the level of debt security of the country. A specific goal has necessitated the following tasks: to study the theoretical foundations of state debt and debt security; to analyze the dynamics of changes in the state debt of Ukraine and the state of national debt security; to determine the problems of management of the state debt, which resulted in the existing state of debt security in Ukraine; to propose of ways to optimize public debt to strengthen debt security. Method or methodology for conducting research. During the research historical, analytical-empirical, inductive-deductive, comparative research methods were used to implement the principle of objectivity of scientific presentation, as well as in the determination of the debt condition of Ukraine, tools of economic-mathematical modeling and graphical presentation of research results were used. Presentation of the main material (results of work). The work is disclosed the theoretical foundations of the state debt, shows his place in economic research and the influence on the debt security of the state. The condition of the state debt of Ukraine is analyzed. The features and rationale for strengthening the debt security of Ukraine through the prism of improving the mechanism for managing and servicing the public debt are disclosed. The field of application of results. The results of the study can be used in the theory and practice of public debt management. The assessment of debt indicators and their analysis will be an expedient source of information for developing ways to strengthen Ukraine's debt security. Conclusions according to the article. One of the main components of financial security is debt security. The role of its decisive component - public debt - determines the priority of public debt management and its servicing, which is an important condition for the stability of the financial system of the state and security. Debt security of Ukraine is in an unsatisfactory state, for improvement it is necessary to improve the debt policy of the state and debt management.

Indian students’ attitude toward educational debt: scale development and validation

Purpose This paper aims to develop, refine and validate a multidimensional scale for measuring students’ attitude toward educational debt for higher studies in Punjab (India) and the impact of this attitude on the satisfaction of students. Design/methodology/approach The study uses interview and survey approach. The sample comprises 417 students from four public and four private universities of Punjab (India). Exploratory factor analysis and confirmatory factor analysis have been used to develop and validate students’ attitude toward education loan scale (Morgado et al., 2017). Further, structural equation modeling (SEM) has been used to analyze the impact of factors of students’ attitude on their satisfaction. Findings The scale has been tested for both reliability and validity. Analysis has revealed six factors of students’ attitude toward educational debt, namely, economic empowerment, social empowerment, utility, procedural requirements, risk and stress. These, six independent variables and one dependent variable, i.e. students’ satisfaction, were entered into structural equation model. The structural equation model shows that procedural requirements, economic empowerment and utility have a positive, whereas stress has a negative and significant impact on the students’ satisfaction. Practical implications Education financing is a gigantic problem nowadays due to the high cost of self-financing courses in Punjab. To make higher education accessible to all students, education loan plays a vital role. Thus, the attitude of students is of great importance to policymakers to bring reforms in education loan scheme. Originality/value To the best of the authors’ knowledge, this study is the foremost study for developing a validated tool to measure the students’ attitude toward educational debt in India.

Farming on Facebook, Camera-less Food Photography and a New Indian Pastoral

Lacunae in media images and reports of death and agrarian based suffering, experienced by India's debt prone farmers, have only begun to be addressed in the Indian news media. While the agrarian crisis is spectacularized through 24 hour news cycle images, analysis of underlying causes is less common in print and digital media. Kheti Badi, a photo-series produced from screenshots of FarmVille (an Adobe Flash gaming application on Facebook), interrogates this media impasse. It critiques homogenized images of food and farming, which rise to the top of web search results, and photojournalistic images showing the dignified suffering of Indian agricultural workers. Kheti Badi's computer made images are an alternative to visual stereotyping of rural India in photojournalism. Its technological inventiveness neither spectacularizes farmer protests or suicides nor aestheticizes pastoral qualities associated with the land. To make visible the changing nature of food production and need to reform farming in India, and its media coverage, Kheti Badi supplants the Indian pastoral with a new pictorial.

Debt Traps? Market Vendors and Moneylender Debt in India and the Philippines

A debt trap occurs when someone takes on a high-interest-rate loan and is barely able to pay back the interest, and thus perpetually finds themselves in debt (often by refinancing). Studying such practices is important for understanding financial decision-making of households in dire circumstances, and also for setting appropriate consumer protection policies. We conduct a simple experiment in three sites in which we paid off high-interest moneylender debt of individuals. Most borrowers returned to debt within six weeks. One to two years after intervention, treatment individuals were borrowing at the same rate as control households. (JEL D14, D18, D91)

An economic analysis of the determinants of pattern of institutional borrowing in India

Institutional borrowing encourages the production and investment capacities if these loans directly contribute to the physical production. On the contrary, institutional borrowing for non-production purposes may lead to the sub-optimal utilization of resources. Present study explores the patterns of different purposes of institutional borrowing in India by identifying the effect of the different socio-economic-demographic factors on the probability (as well as extent) of institutional borrowing for non-production purposes in India. For this purpose, the study uses the data of All India Debt and Investment Survey, 59th (2003) and 70th (2013) rounds of National Sample Survey Organization. While choosing the suitable econometric model, the study has considered the issue of sample selection bias. To avoid this bias, the study uses a two-stage decision process using Heckman sample selection model. The econometric findings show that the probability (as well as the extent) of institutional borrowing for non-production purposes is higher among urban, literate and formally employed households. In addition, the probability of institutional borrowing for non-production purposes is lower among the households in the states with higher levels of consumption inequality but higher among the households in the states with higher infrastructural development in India.

Индекс финансового стресса как обобщающий индикатор финансовой нестабильности

The paper provides an overview of the methods and models for quantitative evaluation of the financial instability of economic systems. The authors identify the indicators of financial instability and show their connection with various stress tests, assessing the vulnerability of economic systems to various shocks. The main results of Russian and foreign studies devoted to the development of early warning systems of financial instability, including various leading indicators of currency, debt and banking crises, are discussed. Particular attention is paid to the experience of building an aggregated financial stress index (FSI) and its use as a generalized indicator of financial instability of economic systems. Using the vector model for error correction, the authors construct cointegration equations for three main variables demonstrating a quick response to external shocks: oil price, ruble exchange rate against the US dollar, and the RTS index. The application of the principal component analysis allowed the authors to aggregate adequately the information contained in these variables. Based on the moving average and standard deviation of the principal components’ growth rates, the authors propose a new financial stress index. In addition, with the help of this index the authors obtained estimates of the level of financial stress in the Russian economy from January 2000 up to February 2019 and revealed differences in the nature of financial stress during the 2008–2009 and 2014–2016 crisis periods.

DR Congo Debt Sustainability: A Quinquennial Assessment

The sustainability of the debt is an important pillar of a healthy economy, especially as it illustrates a country's ability to meet its debt obligations without recourse to debt relief or arrears. This paper analyzes the sustainability of DR Congolese public debt. It starts from the origin of the debt through the analysis of the situation after the completion point of the PPTE initiative to finally analyze the sustainability of the public debt and the risks it faces. Globally, it was noted that without the PPTE initiative, the DRC's external debt indicators would have exceeded the applicable thresholds: 30% of GDP, 100% of exports and 200% of revenues, but once they reach the completion point these ratios fell below the applicable thresholds: 24.4% of GDP, 42% of exports, and 124.3% of revenues.

Access to Formal Credit in the Indian Agriculture: Does Caste matter?

Access to resources and opportunities can be a critical factor in improving outcomes for disadvantaged groups. Improving access to financial resources, in particular, is widely acknowledged to facilitate upward economic and social mobility. Conversely, lack of access to resources for certain groups based on caste, class, gender and ethno-social identities can perpetuate inequalities. In this context, this paper attempts to analyse the access to credit by social groups and decomposes the gross credit differentials using Oaxaca-blinder decomposition method using unit-level data from the All India Debt and Investment Survey, NSSO, 2013. The descriptive analysis clearly shows that there is a significant credit differential between forward caste (FC) and other social groups (SC, ST and OBC). Access to credit varies across social groups based on many factors. The decomposition result indicates that the discrimination coefficient against SC is 49per cent which explains that SCs are being discriminated by 49 per cent compared to FCs in the formal credit market. In case of ST, the discrimination coefficient against is 61per cent and for OBC it is 48per cent. Interestingly, the endowment difference is less among ST (38per cent) compared to SC and OBC (around 51 per cent). Also, the FC treatment advantage (benefit of being a FC in the credit market) is 5.7 per cent whereas the cost of being an SC in the credit market (treatment disadvantage) is 35.1 per cent. As expected, the disadvantage component for ST and OBC is 33.1 per cent and 17.8 per cent respectively. Thus, we see that although programmes, schemes and policies to promote the economic empowerment of lower castes through finance have been implemented on a large scale since the 1990s, they have not been very effective.

Wealth Ownership and Inequality in India: A Socio-religious Analysis

This article analyses wealth inequality across socio-religious groups in the country and across the states based on the All India Debt and Investment Survey conducted by the National Sample Survey Office in 2013. The result shows that one-fourth of the total wealth is concentrated in the hands of the top 1 per cent households, whereas 75 per cent of the total wealth is concentrated in the top 20 per cent households. On the contrary, a very small proportion of the assets, that is, 3.4 per cent, are owned by the bottom 40 per cent households. The Hindu high castes (HHCs) have the highest ownership of wealth as compared to any other socio-religious group with respect to the share of wealth and average household wealth ownership. Interestingly, HHCs also have the highest inequality as compared to any other group.

Determinants of the Capital Structure of Brazilian Companies: An Empirical Analysis of Pecking Order and Trade-Off Theories in 2005 and 2014

This study investigates the determinants of capital structure, using multiple regression technique data for a sample of 723 companies from various sectors of the Brazilian economy between 2005 and 2014 in order to determine the relative importance of the factors specific company. The theory of pecking order provides the existence of a hierarchy in the use of funding sources, while the trade-off theory considers the existence of a target capital structure that would be pursued by the company. Twelve financial variables were used in which five were dependent (related to indebtedness) and seven independent variables (explanatory of the determinants of capital structure). These were: a) indebtedness: Total Indebtedness; Short-term debt; Long-term debt; Costly Financial debt Short-term; and Financial Debt Costly Long-term; b) Determinants of Capital Structure: Current liquidity; Tangibility; Return on assets; Return to Investors; Payment level of income tax; Sales Growth; and Asset Growth. The main results of this study as a contribution were: a) positive relationships in asset tangibility and negative for asset returns; b) the current ratio is negatively related with the debt indicators; c) the return to investors could not confirm their relationship with debt indicators; d) growth of assets is positively related to short-term debt and negatively related to the indebtedness of short and long onerous financial terms; e) sales growth is negatively related to the debt indicators; f) the level of income tax payment showed a positive relationship with the short-term debt, it is not possible to compare it to other levels of indebtedness.

ANALYSIS OF GEVERNMENTAL FUND PERFORMANCE: EVIDENCE FROM TEXAS MUNICIPALITIES

ABSTRACT This study attempts to analyze the governmental fund performance for the ten largest Texas cities using the financial indicators recommended by the ICMA handbook. These ratios cover the operating performance in six aspects: revenue measures, expenditure measures, operating position measures, debt indicators, unfunded liability measures, and capital plant indicators. We collect the data manually from the city’s Comprehensive Annual Financial Reports for the past three years, 2014 to 2016. The ratios are calculated for each city and year, and then are compared with the recommended benchmarks to evaluate the performance of these governments. In addition, change analyses are performed for each city to find out whether the financial performance has been improved, stable, or worsened. Policy implications are discussed based on the overall results. Keywords Governmental spending, Fund performance, State of Texas

О факторах спроса экономического роста

To analyze the problems of economic growth in Russia, the factors of demand that affect economic growth are chosen: the volumes and dynamics of consumer spending, tax instruments and debt indicators in Russia and in recent years. Changes in the population’s expenses for the purchase of goods and services, the purchase of investment goods-real estate, as well as the use of credit sources to replenish the current and investment costs of citizens are analyzed. The main indicators are given in current prices and are recounted by the authors, for greater reliability of the findings, in prices at the beginning of 2015. The reasons for the formation of external and internal debt are revealed. It is noted thatthe external debt in recent years has grown through borrowing in external financial markets through the placement of government securities, as well as an increase in the volume of state guarantees. The thesis was confirmed that in macroeconomics only in the long run the influence of the change in the state debt on consumption is traced. It is especiallyemphasized that the state external debt burdens the national economy of the country, reduces aggregate demand, slows economic growth and, ultimately, leads to a decline in GDP. The state, having placed its stake on domestic debt, has increased the share of state guarantees by 4 times over the past 8 years and brought domestic debt to the limit, which has affected not only the fiscal and fiscal policies of the state, but it can negatively affect Russia’s economic security. In general, amid the downturn in business activity in Russia in recent years, the increase in public debt has led to a reduction in the consumption of durable goods and investment goods. Thus, based on the analysis of the dynamics of consumer spending of Russians, debt and tax policy, it was concluded that the pace of business activity and the need for government intervention in regulating the processes covered in the article, especially in the context of the crisis, were reduced.

THE SIGNAL SYSTEM OF UKRAINE’S ECONOMY EXTERNAL SUSTAINABILITY: INDICATORS APPROACH

In the paper, the signal system of Ukraine’s economy external sustainability is considered. For this purpose it is presented the Ukraine’s economy external sustainability indicators system that consists of 40 indicators that are divided into five groups: macroeconomic indicators; indicators, characterizing the current account position; indicators, characterizing the capital account position; debt indicators and indicators, characterizing the influence of the external sector. Based on the signal approach, the threshold percentiles, the probabilities of instability occurrence due to external disturbances and the noise-signal ratio for each indicator of external sustainability for the Ukrainian economy are calculated. The results of the noise-signal ratio calculations showed that their values for 21 indicators are quite high but less than one. Based on analysis of indicators’ signals, there is a clear tendency of more accurate identification of the volatility since 2008. For the overwhelming majority of indicators the probabilities of an unstable situation arising due to the signal from the indicator are high and exceed 50%. The probability of an unstable situation occurring without indicators’ signals for all external sustainability indicators except one also exceeds 50%. In addition to it for each of the five groups of indicators and the indicators’ system in a whole the average probabilities of unstable situation occurrence is calculated under the condition of a signal from indicators and without it.

Early evaluation of technical debt impact on maintainability

It is widely claimed that Technical Debt is related to quality problems being often produced by poor processes, lack of verification or basic incompetence. Several techniques have been proposed to detect Technical Debt in source code, as identification of modularity violations, code smells or grime buildups. These approaches have been used to empirically demonstrate the relation among Technical Debt indicators and quality harms. However, these works are mainly focused on programming level, when the system has already been implemented. There may also be sources of Technical Debt in non-code artifacts, e.g. requirements, and its identification may provide important information to move refactoring efforts to previous stages and reduce future Technical Debt interest. This paper presents an empirical study to evaluate whether modularity anomalies at requirements level are directly related to maintainability attributes affecting systems quality and increasing, thus, system's interest. The study relies on a framework that allows the identification of modularity anomalies and its quantification by using modularity metrics. Maintainability metrics are also used to assess dynamic maintainability properties. The results obtained by both sets of metrics are pairwise compared to check whether the more modularity anomalies the system presents, the less stable and more difficult to maintain it is.

Debt Traps? Market Vendors and Moneylender Debt in India and the Philippines

A debt trap occurs when someone takes on a high-interest rate loan and is barely able to pay back the interest, and thus perpetually finds themselves in debt (often by re-financing). Studying such practices is important for understanding financial decision-making of households in dire circumstances, and also for setting appropriate consumer protection policies. We conduct a simple experiment in three sites in which we paid off high-interest moneylender debt of individuals. Most borrowers returned to debt within six weeks. One to two years after intervention, treatment individuals were borrowing at the same rate as control households.

Kondycja finansowa jednostek samorządu terytorialnego – koniec wpływu spowolnienia gospodarczego?

Since 2013, the financial standing of local governments (LG) has been gradually improving in Poland. Their debt ratios have decreased and debt service capacity improved remarkably. The analysis of individual LG categories indicates that the progress is not uniform. The most modest recovery was in the category of towns with county rights. The new statutory debt limit created a space to increase their debt, which was not accompanied by adequately strong growth in operating surpluses. At the end of 2015, ca. 15% of towns with county rights crossed the alarming values of debt indicators and they are noticeably exposed to a risk of interest rates increases. The differences between LGs with sound risk profile and LGs with inferior risk profile are growing also for the rural boroughs and the counties. As a result, despite an average improvement in financial ratios for the LG sector, several dozen entities remain in the financial situation even more difficult than in the years 2011–2012.

Bayesian Modelling of Kenya Extreme Debt with Correction for Budgetary Leakage

Total public debt levels in Kenya are exponentially increasing due to rising budget deficit, poor public fund management as well as movement of various macro-economic indicators such as balance of payments, inflation, Gross Domestic Product, exchange rates, and grants leading to worries on whether or not the high debt levels would be sustainable in future. The major concern is that a huge portion of the country’s revenue is committed to debt repayment and budgetary leakage strains the repayment efforts, thereby accelerating the country's debt unsustainability. This study sought to model extreme debt in Kenya with correction for budgetary leakage using a Bayesian approach to Extreme Value Theory (EVT) the main aim being to estimate the maximum debt tolerable for the country. A non-stationary Generalized Pareto Distribution (GPD) model is used for modeling the public debt extremes which depend on some covariates (macro-economic indicators) and Bayesian methods used to directly estimate the threshold and the GPD parameters. A major contribution of this study is the introduction of a compensator to allow for possible leakage due budgetary leakage through corruption, tax evasion, money laundering, and other forms of financial fraud, modelling it as a function of budget deficit. The established debt threshold is approximately KShs. 2 trillion which is the standard amount that should be borrowed, beyond which values are considered extremes. The results indicate that the movements in the macro-economic debt indicators significantly affect total public debt levels, and that budgetary leakage reduces Kenya's debt tolerance. The research concluded that the current debt level of around KShs. 5 trillion is still sustainable but high budgetary leakage may accelerate the country's long-run debt unsustainability. For further work, it is recommended to use a time-varying threshold to capture seasonality of the public debt series.