Debt Policy and Economic Growth in a Small Open Economy Model with Productive Government Spending

Koichi Futagami, Takeo Hori and Ryoji Ohdoi

Working Papers from eSocialSciences

Abstract: In this paper, the effects of introducing constraints on government borrowing have been examined by using a continuous-time overlapping generations model of a small open economy. Government placing constraints on the amount of government bonds have been considered outstanding by establishing an upper limit, or target level, for the ratio of government bonds to gross domestic product. First it is shown that there exist multiple steady states in the model small open economy. Next the target level for bonds affecting economic growth rates at the steady states is examined.

Keywords: government; borrowing; overlapping; generations; model; positive; amount; asset; holdings; economy (search for similar items in EconPapers)
Date: 2010-05
New Economics Papers: this item is included in nep-cwa, nep-dge and nep-fdg
Note: Institutional Papers
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Debt Policy and Economic Growth in a Small Open Economy Model with Productive Government Spending (2010)
Working Paper: Debt Policy and Economic Growth in a Small Open Economy Model with Productive Government Spending (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ess:wpaper:id:2502

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