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Crowding Out, Deficits, and Interest Rates: Reply

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  • Cebula, Richard

Abstract

This Note endeavors to illustrate the relevance of the impact of the budget deficit upon the interest rate to the issue of crowding out. It is argued that empirical studies of the impact of deficits upon interest rates may be very useful in det­ermining whether (and how) crowding out occurs, but that additional empirical analysis involving the interest sensitivity of commodity market demand is needed to then determine the degree of crowding out.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 51628.

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Date of creation: 08 May 1987
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Publication status: Published in Public Choice 1.58(1988): pp. 95-97
Handle: RePEc:pra:mprapa:51628

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Keywords: budget deficits; crowding out; interest rates;

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  1. Richard Cebula, 1987. "Federal deficits and the real rate of interest in the United States: A note," Public Choice, Springer, Springer, vol. 53(1), pages 97-100, January.
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