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Indexed Bonds and Heterogenous Agents

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  • Mayer, T.

Abstract

The widespread belief that one can read off the public's expectations of inflation from the yield differential between indexed and conventional bonds ignores the fact that indexed bonds are held largely by those who expect the most inflation. However, holding indexed bonds as a hedge against inflation implies that such bonds have the advantage of being a relatively cheap source of funds.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Mayer, T., 1993. "Indexed Bonds and Heterogenous Agents," Papers 93-07, California Davis - Institute of Governmental Affairs.
    • Handle: RePEc:fth:caldav:93-07
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    References listed on IDEAS

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    Cited by:

    1. James E. Hartley, 1996. "Retrospectives: The Origins of the Representative Agent," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 169-177, Spring.
    2. William Gissy, 1999. "Treasury bill rates and treasury cash reserves," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 27(4), pages 435-443, December.
    3. Ian Christensen & Frédéric Dion & Christopher Reid, 2004. "Real Return Bonds, Inflation Expectations, and the Break-Even Inflation Rate," Staff Working Papers 04-43, Bank of Canada.

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