Type
Article
Titre
Dynamic Efficiency, the Riskless Rate, and Debt Ponzi Games under Uncertainty
Dans
Advances in macroeconomics
Auteur(s)
BLANCHARD Olivier - Department of Economics (Massachusetts University of Technology) (Auteur)
WEIL Philippe - (Auteur)
Éditeur
US : Berkeley Electronic Press
Volume
1
Numéro
2
Pages
1 - 23 p.
Notes
http://www.bepress.com/bejm/advances/vol1/iss2/art3
ISSN
15346013
Résumé
EN
In a dynamically efficient economy, can a government roll its debt forever and avoid the need to raise taxes? In a series of examples of economies with zero growth, this paper shows that such Ponzi games may be infeasible even when the average rate of return on bonds is negative, and may be feasible even when the average rate of return on bonds is positive. The paper then reveals the structure which underlies these examples.

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