Introduction: Private Wealth and Public Debt

Carl Christian von Weizsäcker () and Hagen Krämer
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Carl Christian von Weizsäcker: Max Planck Institute for Research on Collective Goods

Chapter Chapter 1 in Saving and Investment in the Twenty-First Century, 2021, pp 1-13 from Springer

Abstract: Abstract In the economic area comprising the OECD countries plus ChinaChina, almost half of private wealthWealth, private consists of net public debt. Private wealth is nearly twice the size of private real assets. Due to the continuing rise in life expectancyLife expectancy, the share of public debt in private wealthWealth, private is growing. As long as public debt does not become too great, real interest rates can be low, but positive in the twenty-first century. The main reason for this is private retirement planning in light of high life expectancyLife expectancy. Investment cannot keep up with increasing private savingSaving. In the twenty-first century, public debt is a macroeconomic steering instrumentPolicy, fiscal. Fiscal policyFiscal policy uses it to ensure that a positive, but low real interest rate level continues to prevail.

Date: 2021
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DOI: 10.1007/978-3-030-75031-2_1

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