Debt Policy in a Competitive Two-Sector Overlapping Generations Model
AbstractIn this paper debt policy in a two-period, two-sector overlapping generations model with Leontief technologies has been analysed. It has been found that debt, issued to transfer resources to the initially old, could be welfare improving in the new steady state for an economy which satisfies the usual conditions for dynamic efficiency viz. the rate of interest is at least as great as the population growth rate. [Working paper No. 137]
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Government Debt; Overlapping Generations; Two-Sector Models; Dynamic Efficiency;
Other versions of this item:
- Partha Sen, 2005. "Debt Policy in a Competitive Two-Sector Overlapping Generations Model," Working papers 137, Centre for Development Economics, Delhi School of Economics.
- E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
- E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-09 (All new papers)
- NEP-DGE-2010-10-09 (Dynamic General Equilibrium)
- NEP-FDG-2010-10-09 (Financial Development & Growth)
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