Current and anticipated deficits, interest rates and economic activity
AbstractThere is widespread feeling that current deficits, in Europe and the U.S.,may hurt rather than help the recovery. This paper examines some of the issues involved, through a sequence of three models.The first model focuses on sustainability and characterizes its determinants. It suggests that the issue of sustainability may indeed ber elevant in some countries.The second model focuses on the effects of fiscal policy on real interestrates, and in particular on the relative importance of the level of deficits andthe level of debt in determining interest rates.The third model focuses on the effects of fiscal policy on the speed of the recovery. It shows how a sharply increasing fiscal expansion might be initially contractionary rather than expansionary.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal European Economic Review.
Volume (Year): 25 (1984)
Issue (Month): 1 (June)
Contact details of provider:
Web page: http://www.elsevier.com/locate/eer
Other versions of this item:
- Olivier J. Blanchard, 1991. "Current and Anticipated Deficits, Interest Rates and Economic Activity," NBER Chapters, in: International Volatility and Economic Growth: The First Ten Years of The International Seminar on Macroeconomics, pages 361-390 National Bureau of Economic Research, Inc.
- Olivier J. Blanchard, 1984. "Current and Anticipated Deficits, Interest Rates and Economic Activity," NBER Working Papers 1265, National Bureau of Economic Research, Inc.
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- S. Sgherri, 2000.
"The fiscal dimension of a common monetary policy: results with a non-Ricardian global model,"
WO Research Memoranda (discontinued)
615, Netherlands Central Bank, Research Department.
- Silvia Sgherri, 2002. "The fiscal dimension of a common monetary policy: results with a non-Ricardian global model," European Journal of Finance, Taylor and Francis Journals, vol. 8(4), pages 449-479.
- Buiter, Willem H, 1984.
"Measuring Aspects of Fiscal and Financial Policy,"
CEPR Discussion Papers
13, C.E.P.R. Discussion Papers.
- Magud, Nicolas E., 2008. "On asymmetric business cycles and the effectiveness of counter-cyclical fiscal policies," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 885-905, September.
- Marina Azzimonti, 2013. "The political economy of balanced budget amendments," Business Review, Federal Reserve Bank of Philadelphia, issue Q1, pages 11-20.
- Alberto Petrucci, 2004. "Asset Accumulation, Fertility Choice and Nondegenerate Dynamics in a Small Open Economy," Working Papers 2004.121, Fondazione Eni Enrico Mattei.
- Turnovsky, Stephen J., 1986.
"Short-term and long-term interest rates in a monetary model of a small open economy,"
Journal of International Economics,
Elsevier, vol. 20(3-4), pages 291-311, May.
- Stephen J. Turnovsky, 1987. "Short-Term and Long-Term Interest Rates in a Monetary Model of a Small Open Economy," NBER Working Papers 1716, National Bureau of Economic Research, Inc.
- William Smith, 1998. "Birth, Death, and Consumption: Overlapping Generations and the Random Walk Hypothesis," International Economic Journal, Korean International Economic Association, vol. 12(4), pages 105-116.
- Bruno Ducoudré, 2005. "Fiscal policy and interest rates," Documents de Travail de l'OFCE 2005-08, Observatoire Francais des Conjonctures Economiques (OFCE).
- Niklas Potrafke & Markus Reischmann, 2012.
"Fiscal Equalization Schemes and Fiscal Sustainability,"
Ifo Working Paper Series
Ifo Working Paper No. 141, Ifo Institute for Economic Research at the University of Munich.
- Niklas Potrafke & Markus Reischmann, 2012. "Fiscal Equalization Schemes and Fiscal Sustainability," CESifo Working Paper Series 3948, CESifo Group Munich.
- Sinai, Allen, 2006. "Deficits, expected deficits, financial markets, and the economy," The North American Journal of Economics and Finance, Elsevier, vol. 17(1), pages 79-101, March.
- Christophe Tavera & Isabelle Cadoret, 1998. "L'impact du déficit public sur la vitesse de convergence des économies européennes," Économie et Prévision, Programme National Persée, vol. 132(1), pages 37-48.
- Michael J. Artis & Marco Buti, 2000.
"'Close-to-Balance or in Surplus': A Policy-Maker's Guide to the Implementation of the Stability and Growth Pact,"
Journal of Common Market Studies,
Wiley Blackwell, vol. 38(4), pages 563-591, November.
- Artis, Michael J & Buti, Marco, 2000. ""Close to Balance or in Surplus": A Policy Maker's Guide to the Implementation of the Stability and Growth Pact," CEPR Discussion Papers 2515, C.E.P.R. Discussion Papers.
- Michael J. Artis & Marco Buti, 2000. "Close to Balance or in Surplus. A Policy Maker’s Guide to the Implementation of the Stability and Growth Pact," EUI-RSCAS Working Papers 28, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
- Douglas W. Elmendorf & Jeffrey B. Liebman & David W. Wilcox, 2001. "Fiscal Policy and Social Security Policy During the 1990s," NBER Working Papers 8488, National Bureau of Economic Research, Inc.
- Green, Christopher J. & Holmes, Mark J. & Kowalski, Tadeusz, 2001. "Poland: a successful transition to budget sustainability?," Emerging Markets Review, Elsevier, vol. 2(2), pages 161-183, June.
- Martin Feldstein, 1984. "Can an Increased Budget Deficit Be Contractionary?," NBER Working Papers 1434, National Bureau of Economic Research, Inc.
- Holinski, Nils, 2010. "The wealth of nations: global imbalances and adjustments in a financially integrated world," Open Access publications from Maastricht University urn:nbn:nl:ui:27-24477, Maastricht University.
- Benz, Ulrich & Fetzer, Stefan, 2004. "Indicators for Measuring Fiscal Sustainability: A Comparative Application of the OECD-Method and Generational Accounting," Discussion Papers 118, Institut für Finanzwissenschaft, Albert-Ludwigs-Universität Freiburg.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wendy Shamier).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.