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Management of the Nominal Public Debt Theory and Applications


  • Pablo Emilio Guidotti
  • Guillermo Calvo


Optimal management of the public debt is explored in a context where economic policy is continuously revised because, when the public debt is non—indexed, policy—makers are tempted to use inflation in order to reduce the real value of the public debt. The model’s implications are explored following two approaches. First, the effects of various exogenous disturbances are examined by means of numerical simulations. Secondly, the analysis explores—for Italy, Ireland, and the United States—if the model’s implications concerning the maturity structure of government debt are consistent with actual experience.

Suggested Citation

  • Pablo Emilio Guidotti & Guillermo Calvo, 1990. "Management of the Nominal Public Debt Theory and Applications," IMF Working Papers 90/115, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:90/115

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    References listed on IDEAS

    1. Rodrigo O. Valdes & Eduardo M Engel, 2000. "Optimal Fiscal Strategy for Oil Exporting Countries," IMF Working Papers 00/118, International Monetary Fund.
    2. International Monetary Fund, 2005. "Trinidad and tobago; The Energy Boom and Proposals for a Sustainable Fiscal Policy," IMF Working Papers 05/197, International Monetary Fund.
    3. Jan-Peter Olters & Daniel Leigh, 2006. "Natural-Resource Depletion, Habit Formation, and Sustainable Fiscal Policy; Lessons from Gabon," IMF Working Papers 06/193, International Monetary Fund.
    4. R. M. Solow, 1974. "Intergenerational Equity and Exhaustible Resources," Review of Economic Studies, Oxford University Press, vol. 41(5), pages 29-45.
    5. H. Takizawa & E. H. Gardner & Kenichi Ueda, 2004. "Are Developing Countries Better Off Spending Their Oil Wealth Upfront?," IMF Working Papers 04/141, International Monetary Fund.
    6. Luis Serven & César Calderon, 2004. "The Effects of Infrastructure Development on Growth and income," Econometric Society 2004 Latin American Meetings 173, Econometric Society.
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    Cited by:

    1. Santiago Herrera, 2000. "Determinantes y composición del endeudamiento público en Colombia," IDB Publications (Working Papers) 2110, Inter-American Development Bank.
    2. Santiago Herrera, 2000. "Determinantes y Composición del Endeudamiento Público en Colombia," Research Department Publications 3105, Inter-American Development Bank, Research Department.

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