Since 2007, worldwide public debt has ballooned from 40% to 60% of GDP, on average, with debt-to-GDP ratios even higher in the advanced countries.
That includes the United States, the world's biggest economy, where government debt is now more than double the nation's yearly economic output.
Reuters GraphicsDespite mounting worries about the growth-crimping implications of high debt, "debt reduction, while desirable in principle, is unlikely in practice," Serkan Arslanalp, an economist at the International Monetary Fund, and Barry Eichengreen, an economics professor at the University of California, Berkeley, wrote in a paper.
Inflation, unless it surprises to the upside over an extended period, does little to reduce debt ratios, and debt restructuring for developing countries has become more elusive as the pool of creditors has broadened, Arslanalp and Eichengreen wrote.
"High public debts are here to stay," they wrote.
Persons:
Dado Ruvic, Jackson, Barry Eichengreen, Eichengreen, Ann Saphir, Paul Simao
Organizations:
REUTERS, Kansas City Federal, International Monetary Fund, University of California, Thomson
Locations:
Saudi, , Wyoming, Jackson Hole , Wyoming, United States, Berkeley