Assessing Debt Sustainability in Brazil

Alexandre De Carvalho, Pedro A. S. Salomão
2007 Brazilian Review of Econometrics  
We study Ramsey model for an open economy applied to the case of Brazil. We find optimal trajectories of consumption, investment, capital stock and net foreign liabilities and, with this, analyze debt sustainability in Brazil. A new approach to capturing optimal trajectories is presented. The main tools are the Stable Manifold Theorem and the Lambda Lemma, normally used in the field of dynamical systems.
doi:10.12660/bre.v27n12007.1571 fatcat:ptxlhmurprdi7obe3u7q3hdawy