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Uses and Limitations of Public Debt

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Abstract

This paper addresses three related issues. First, in what sense is the goverment’s ability to borrow limited by its capacity to tax? Second, when is Ponzi finance1 feasible for an infinite-lived government? Third, when does the opportunity to engage in Ponzi finance enhance the government’s ability to influence private resource allocation?

Keywords

  • Interest Rate
  • Fiscal Policy
  • Public Debt
  • Transfer Payment
  • Solvency Constraint

These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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© 1998 Palgrave Macmillan, a division of Macmillan Publishers Limited

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Buiter, W.H., Kletzer, K.M. (1998). Uses and Limitations of Public Debt. In: Brakman, S., van Ees, H., Kuipers, S.K. (eds) Market Behaviour and Macroeconomic Modelling. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-26732-3_11

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