Is the Fiscal Sustainability of Developed Countries Influenced by Economic Doctrines?

This paper assesses the long-term sustainability of public finance systems in advanced economies by focusing on the relative amounts from the main sources financing government expenditure tax revenues and public debt as well as on the feasibility of achieving a balanced budget under existing expenditure commitments, economic structures, and debt levels. The aim of the study is to evaluate the capacity of advanced economies to finance public spending through current revenues and to identify a reasonable balance between fiscal and debt funding. The method employs quantitative analysis of general government budget indicators and public finance data derived from IMF and OECD statistical databases for 23 advanced economies. This empirical approach is complemented by comparative and historical analysis of the evolution of fiscal and monetary policy. The results suggest that, irrespective of the prevailing economic doctrine, government expenditures tend to grow faster than revenues, a situation that leads to persistent budget deficits and rising public debt. Conventional fiscal consolidation measures, such as expenditure cuts and tax increases, have produced only limited effects. In recent decades, fiscal sustainability has largely depended on a low interest rate policy; however, rising inflation and debt servicing costs since 2020 have significantly increased the vulnerabilities of public finance. The paper concludes that the continuation of current fiscal policies is likely to intensify risks to budget sustainability. It highlights the need for stricter expenditure control, particularly through the reduction of unproductive expenditures, in order to restore a positive primary balance. A reallocation of the tax burden from direct to indirect taxation is also considered as a viable policy option.