The Impact of the Federal Budget Deficit on the Nominal Interest Rate Yield on US Treasury Notes, 1979-2001
This study empirically examines the impact of the federal government budget on the nominal interest rate yield on US Treasury notes over the 1979-2001 period. In a system that includes the monetary base, the civilian labor force unemployment rate, the ex ante real 52 week Treasury bill rate, and the percentage growth rate of the S&P 500 stock index, Error-Corrections Model (ECM) estimation finds that the total federal budget deficit acted to increase the nominal interest rate yield on seven year US Treasury notes over the study period.
|Date of creation:||08 Sep 2003|
|Date of revision:|
|Publication status:||Published in The ICFAI Journal of Applied Economics 2.3(2004): pp. 7-18|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Cebula, Richard J, 1988. "Federal Government Budget Deficits and Interest Rates: An Empirical Analysis for the United States, 1955-1984," Public Finance = Finances publiques, , vol. 43(3), pages 337-48.
- Hoelscher, Gregory, 1986. "New Evidence on Deficits and Interest Rates," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 18(1), pages 1-17, February.
- James R. Barth & George Iden & Frank S. Russek, 1984. "Do Federal Deficits Really Matter?," Contemporary Economic Policy, Western Economic Association International, vol. 3(1), pages 79-95, 09.
- Evans, Paul, 1985. "Do Large Deficits Produce High Interest Rates?," American Economic Review, American Economic Association, vol. 75(1), pages 68-87, March.
- Feldstein, Martin S & Eckstein, Otto, 1970. "The Fundamental Determinants of the Interest Rate," The Review of Economics and Statistics, MIT Press, vol. 52(4), pages 363-75, November.
- Cebula, Richard J. & Saltz, Ira S., 1998. "Ex Ante Real Long-Term Interest Rates and U.S. Federal Budget Deficits: Preliminary Error-Correction Evidence, 1971-1991," Economia Internazionale / International Economics, Camera di Commercio di Genova, vol. 51(2), pages 163-169.
- Cebula, Richard, 1996. "An Empirical Note on the Impact of the Federal Budget Deficit on Ex Ante Real Long-Term, Interest Rates, 1973-1995," MPRA Paper 51414, University Library of Munich, Germany.
- Cebula, Richard J & Belton, Willie J, 1993. "Government Budget Deficits and Interest Rates in the United States: Evidence for Closed and Open Systems Put into Perspective, 1955-1989," Public Finance = Finances publiques, , vol. 48(2), pages 188-209.
- Vito Tanzi, 1985. "Fiscal Deficits and Interest Rates in the United States: An Empirical Analysis, 1960-84 (DÃ©ficits budgÃ©taires et taux d'intÃ©rÃªt aux Etats-Unis: analyse empirique, 1960-84) (El dÃ©ficit fiscal y la," IMF Staff Papers, Palgrave Macmillan, vol. 32(4), pages 551-576, December.
- Barth, James R & Iden, George & Russek, Frank S, 1986. "Government Debt, Government Spending, and Private Sector Behavior: Comment," American Economic Review, American Economic Association, vol. 76(5), pages 1158-67, December.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:49400. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.