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There is no universal debt-to-GDP threshold beyond which government debt becomes unsustainable; sustainability depends on factors like the real interest rate.

Drawn from what Olivier Blanchard said

What this subject means

government What states are for and what they are worse at than markets and networks: legitimacy, moral hazard, and who may be entrusted with power.

Does public debt cost what we think it does?under our view: Below-growth rates make debt far cheaper than the usual alarm suggests

What Olivier Blanchard actually said

  1. Olivier Blanchard Economist; former chief economist of the International Monetary Fund
    The analysis in this chapter has shown that there is no such thing as a universal threshold over which debt becomes unsustainable, and that the relevant debt level depends on many factors, in particular the real interest rate on debt.

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