IDEAS home Printed from https://ideas.repec.org/p/bfr/econot/19.html
   My bibliography  Save this paper

Why Have Interest Rates Fallen far Below the Return on Capital
[Pourquoi les taux d’intérêt ont baissé, et pas le rendement du capital]

Author

Listed:
  • Magali Marx
  • Benoît Mojon
  • François Velde

Abstract

Risk-free rates have been falling since the 1980s while the return on capital has not (Figure 1). In the framework of an overlapping-generation model, Marx, Mojon, Velde (2017) show that these contrasted developments can be mainly explained by an increase in the (perceived) risk on productivity growth. This implies that real rates are likely to stay low for several years. Les taux sans risque ont baissé depuis 1980, pas le rendement du capital (Graphique 1). Dans le cadre d’un modèle à générations imbriquées, Marx, Mojon et Velde (2017) montrent que ces évolutions contrastées peuvent s’expliquer principalement par une augmentation du risque (perçu) sur la croissance de la productivité. Ceci implique que les taux réels vont probablement rester bas pendant plusieurs années.

Suggested Citation

  • Magali Marx & Benoît Mojon & François Velde, 2017. "Why Have Interest Rates Fallen far Below the Return on Capital [Pourquoi les taux d’intérêt ont baissé, et pas le rendement du capital]," Eco Notepad (in progress) 19, Banque de France.
    • Handle: RePEc:bfr:econot:19
    as

    Download full text from publisher

    File URL: https://www.banque-france.fr/en/publications-and-statistics/publications/why-have-interest-rates-fallen-far-below-return-capital
    Download Restriction: no
    File URL: https://www.banque-france.fr/fr/publications-et-statistiques/publications/pourquoi-les-taux-dinteret-ont-baisse-et-pas-le-rendement-du-capital
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bfr:econot:19. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael brassart (email available below). General contact details of provider: https://edirc.repec.org/data/bdfgvfr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.