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Rotten Parents and Disciplined Children: A Politico‐Economic Theory of Public Expenditure and Debt

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  • Zheng Song
  • Kjetil Storesletten
  • Fabrizio Zilibotti

Abstract

sufficiently large, the economy converges to a stationary debt level which is bounded away from the endogenous debt limit.
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Suggested Citation

  • Zheng Song & Kjetil Storesletten & Fabrizio Zilibotti, 2012. "Rotten Parents and Disciplined Children: A Politico‐Economic Theory of Public Expenditure and Debt," Econometrica, Econometric Society, vol. 80(6), pages 2785-2803, November.
  • Handle: RePEc:ecm:emetrp:v:80:y:2012:i:6:p:2785-2803
    DOI: ECTA8910
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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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