I have been reading about sovereign debt levels across developed and emerging economies and I keep running into questions about data reliability. For countries with strong institutions and transparent reporting, I assume the numbers are reasonably accurate. But for others where governance is weaker or where there is political incentive to understate liabilities, how do economists adjust for that. I have seen papers that use alternative measures like debt held by foreign creditors or implied debt from contingent liabilities, but I am curious about the methodological approaches that researchers use to verify or adjust reported numbers. Also, how do organizations like the IMF or World Bank handle these inconsistencies when constructing their datasets. Does the academic literature generally trust official debt figures for most countries or is there a significant body of work trying to correct for misreporting. I am looking for insights into the tools and methods used to ensure data quality in this area.
How do economists measure the quality of government debt data, especially when it comes to cross-country comparisons?
byu/Traditional-Mix-258 inAskEconomics
Posted by Traditional-Mix-258