THE IMPORTANCE OF PUBLIC DEBT IN THE ECONOMY- THE CASE OF THE REPUBLIC OF MACEDONIA

The issue of public finance stability is one of the many issues for which many analyzes are made whether high budget deficits are causing them or not. Also, the sustainability of the state debt is presented as a global political and economic challenge. In the long run, public debt impacts on economic growth, lowering the tax rate, promoting macroeconomic income savings, and facilitating equality between layers in society. Public debt is different from private debt, which makes it even more important to analyze its effects. Public debt in general is a disturbing term. Public debt represents the accumulated loan value that the state has taken to finance past deficits. Huge part of the public debt is in short-term securities such as government bonds that carry interest. Public debt poses a burden on the economy because it must also return, reducing national incomes. It may be external and internal debt. Domestic debt represents the share of public debt that the state owes to its businesses and citizens. Domestic debt arises from the state's need for money, for boosting economic or social infrastructure.