The public debt multiplier

• Tác giả: Alice Albonico, Guido Ascari, Alessandro Gobbi
• Ngôn ngữ: eng
• Ký hiệu phân loại: 336.34 Public debt
• Thông tin xuất bản: 2020
• Bộ sưu tập: Báo, Tạp chí
• ID: 165474

Tóm tắt

We study the effects on economic activity of a pure temporary change in government debt and the relationship between the debt multiplier and the level of debt in an overlapping generations framework. The debt multiplier is positive but quite small during normal times while it is much larger during crises. Moreover, it increases with the steady state level of debt. Hence, the call for fiscal consolidation during recessions seems ill-advised. Finally, a rise in the steady state debt-to-GDP level increases the steady state real interest rate providing more room for manoeuvre to monetary policy to fight deflationary shocks.