Painful medicine by Laurence Ball, Daniel Leigh and Prakash Loungani. “When British Prime Minister David Cameron announced his government´s deficit reduction plans earlier this year he said, ‘Those who argue that dealing with our deficit and promoting growth are somehow alternatives are wrong. You cannot put off the first in order to promote the second`(Cameron, 2011). The challenge facing the United Kingdom and many advanced economies is how to bring debt down to safer levels in the face of a weak recovery. Will deficit reduction lead to stronger growth and job creation in the short run? Recent IMF research provides an answer to this question.”
