An empirically plausible model of low real interest rates and unbacked government debt

• 成果类型: Article
• 署名作者: Bullard, J; Russell, S
• 署名单位: Purdue University System; Purdue University; Purdue University in Indianapolis; Federal Reserve System - USA
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/S0304-3932(99)00031-8
• 发表日期: 1999
• 页码: 477-508
• 关键词: overlapping generations model; monetary steady state; real interest rate; government debt

摘要

We study the properties of an overlapping generations model with many-period-lived agents, neoclassical production and capital accumulation, labor-leisure decisions, population growth, and technological progress. We demonstrate that a plausibly calibrated version of this model has 'monetary steady states' - Samuelson-case steady states with large real stocks of unbacked government debt. These steady states can duplicate a number of important features of US post-war data, including three phenomena that challenge other sorts of calibrated models: the low average real interest rate on US government debt, the government's success in reducing the debt/GDP ratio without running large budget surpluses and the relatively high ratio of net saving to output. (C) 1999 Elsevier Science B.V. All rights reserved.