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Government Ponzi Games and Debt Dynamics Under Uncertainty

1991-12-01 Business & Economics
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Release : 1991-12-01
Genre : Business & Economics
Kind : eBook
Book Rating : 862/5 ( reviews)

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Book Synopsis Government Ponzi Games and Debt Dynamics Under Uncertainty by : Mr.Carlo Cottarelli

Download or read book Government Ponzi Games and Debt Dynamics Under Uncertainty written by Mr.Carlo Cottarelli. This book was released on 1991-12-01. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the conditions for sustainability of debt roll-over schemes under uncertainty. In contrast with the requirements identified in recent research, we show that a necessary and sufficient condition for sustainability of such schemes is that the asymptotic interest rate on government debt be lower than the asymptotic growth rate of the economy, a natural extension of a familiar criterion in a deterministic framework. However, we also show that for realistic parameter values, Ponzi games that are sustainable in the long run may display explosive patterns over relatively long horizons. This may explain why governments may be reluctant to play Ponzi games even when they are feasible in the long run.

Government Ponzi Games and Debt Dynamics Under Uncertainty

2006
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Release : 2006
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Book Synopsis Government Ponzi Games and Debt Dynamics Under Uncertainty by : Leonardo Bartolini

Download or read book Government Ponzi Games and Debt Dynamics Under Uncertainty written by Leonardo Bartolini. This book was released on 2006. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the conditions for sustainability of debt roll-over schemes under uncertainty. In contrast with the requirements identified in recent research, we show that a necessary and sufficient condition for sustainability of such schemes is that the asymptotic interest rate on government debt be lower than the asymptotic growth rate of the economy, a natural extension of a familiar criterion in a deterministic framework. However, we also show that for realistic parameter values, Ponzi games that are sustainable in the long run may display explosive patterns over relatively long horizons. This may explain why governments may be reluctant to play Ponzi games even when they are feasible in the long run.

Government Ponzi Games and Debt Dynamic Under Uncertainty

1991
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Release : 1991
Genre :
Kind : eBook
Book Rating : /5 ( reviews)

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Book Synopsis Government Ponzi Games and Debt Dynamic Under Uncertainty by : L. Bartolini

Download or read book Government Ponzi Games and Debt Dynamic Under Uncertainty written by L. Bartolini. This book was released on 1991. Available in PDF, EPUB and Kindle. Book excerpt:

Dynamic Efficiency, the Rickless Rate and Debt

2001
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Release : 2001
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Book Synopsis Dynamic Efficiency, the Rickless Rate and Debt by : Olivier J. Blanchard

Download or read book Dynamic Efficiency, the Rickless Rate and Debt written by Olivier J. Blanchard. This book was released on 2001. Available in PDF, EPUB and Kindle. Book excerpt: In a dynamically efficienct economy, can a government roll its debt forever and avoid the need to raise taxes? In a series of examples of production 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. Keywords: Dynamic efficiency, pareto optimality, bubbles, Ponzi games, public debt, riskless rate.

Dynamic Efficiency and Debt Ponzi Games Under Uncertainty

1990
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Release : 1990
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Book Synopsis Dynamic Efficiency and Debt Ponzi Games Under Uncertainty by : Olivier Blanchard

Download or read book Dynamic Efficiency and Debt Ponzi Games Under Uncertainty written by Olivier Blanchard. This book was released on 1990. Available in PDF, EPUB and Kindle. Book excerpt:

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