Budget deficits and asset sales∗

New Zealand's Privatization Programme: Objectives, Principles, Problems, and Outcomes*

“…There is a general consensus amongst New Zealand economists that the level of public debt was, and remains, a genuine cause for concern and that measures need to be taken to prevent it growing further and, if possible, to reduce it. There is less consensus, however, as to whether asset sales are the appropriate way of addressing the debt problem (McCann, 1988;Treasury, 1990a;Williams, 1990). On the one hand, it has been pointed out that there is no particular merit in reducing public overseas debt while correspondingly increasing private overseas debt (which is what has happened with respect to certain asset sales).…”