Research On The Preventive Strategies Of Public Debt Risk In Post-Crisis Era

Public debt plays an important role in offsetting the government budget deficits,and it has profound influences on macro-economy as well as the finance and banking.The risk of public debt is an important topic for studying in the field of public debt.Since the first foreign debt in l979and the first domestic debt in l98l, the mushroomgrowth of public debt in China has evoked much controversy. Researches into China’spublic debt have been started early enough in the academic community that a lot ofrelated scientific achievements have been scored. Our knowledge of public debt arebeing changed from non-perfect to perfect.In post-crisis era，many countries generally face the challenges of public debtrisk. Therefore, it is more urgent to carry out effective fiscal policies and strengthenthe reform of tax system, supplemented by financial sector and economic structurereform in order to ensure sustainable growth of public debt and economicdevelopment. This paper tries to make the all-round analysis and research of publicdebt issue from the angle of risk, in order to find an effective path for preventingpublic debt risk in post-crisis era.The paper first reviews the development of China’s public debt system, and thendiscusses briefly the new change of public debt risk in post-crisis era. The paperbelieves that, public debt has fiscal and monetary characteristics, thus its risk has twolevels-----financial risk and monetary risk, which need to be monitored and preventedcarefully.Public debt is a medium of coupling the finance and monetary policies. And it isvery necessary to discuss the size of public debt for coordinating the finance andmonetary policies effectively. The paper analysis our country’s public debt riskthrough related economic data and risk indicators, discusses whether the size of publicdebt is at the moderate level or not, and how to optimize the size of public debt byVAR model. Finally, the paper suggests countermeasures for the development and perfection of public debt system and fiscal and taxation policies in order that we cankeep public debt risk away...