what role does public debt hysteresis play in fiscal sustainability 
public debt hysteresis occurs when high levels of public debt limit a government s fiscal flexibility the need to service debt may lead to prolonged periods of hysteresis as the government may not have the ability to spend in other critical areas in the future the bottom linehysteresis in the context of finance refers to the lasting impact of past economic events on the current state of financial markets it highlights how shocks and disruptions such as financial crises can lead to persistent effects influencing market behavior credit conditions and overall economic performance over an extended period 