Fiscal sustainability in the G-7 countries

Abstract

The main objective of this chapter is to assess the fiscal sustainability performance of the G-7 countries before, during, and after the global financial crisis. We examine the movement of various socio-economic and fiscal indicators before, during, and after the crisis period in the G-7 countries. We find that the trends of the key fiscal balance indicators clearly reflect the negative effects of the crisis in the G-7 countries. Furthermore, the ageing population and increases in public health expenditure produce an additional fiscal strain. However, Germany has been able to achieve a good financial performance compared with the other G-7 countries.