World Interest Rates and Investment

Robert Barro

No 3849, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In a world of integrated capital markets, the price of credit — which I measure by short-term expected real interest rates — is determined to equate the world aggregate of investment demand to the world aggregate of desired national saving. I implement this approach empirically by approximating the world by aggregates for ten major developed countries. For the period since 1959, the common component of expected real interest rates for these countries relates especially to developments on world stock and oil markets and secondarily, to world monetary and fiscal policies.

Date: 1991-09
Note: EFG ME
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Citations: View citations in EconPapers (6)

Published as Barro, Robert J, 1992. " World Interest Rates and Investment," Scandinavian Journal of Economics, Blackwell Publishing, vol. 94(2), pages 323-42.

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