We develop the theory of price-level determination in a range of models using both ad hoc
policy rules and jointly optimal monetary and fiscal policies and discuss empirical issues that …

Quality institutions augment economic sustainability by ensuring domestic resource
optimization with equitable development principles. Therefore, ensuring this equitable …

In this paper we study how a benevolent government that cannot commit to future policy
should trade off the costs and benefits of public expenditure. We characterize and solve for …

We study the conditions under which unconventional (balance sheet) monetary policy can
rule out self-fulfilling sovereign default in a model with optimizing but discretionary fiscal and …

We study the effect of public debt on economic growth for annual and 5-year average growth
rates, as well as the existence of non-linearity effects of debt on growth for 14 European …

We survey recent theories of public debt that incorporate political decision making in rich
dynamic environments. These theories provide a new framework with which to interpret …

The tendency of countries to accumulate public debt has been rationalized in models of
political disagreement and lack of commitment. We analyze in a benchmark model how the …

Recent work on optimal monetary and fiscal policy in New Keynesian models suggests that
it is optimal to allow steady‐state debt to follow a random walk. In this paper we consider the …

Emerging market governments hold mixed debt portfolios: They borrow at home and abroad
in both nominal and real terms. This paper incorporates such a mixed debt structure into a …

In view of the fact that the traditional model of tax smoothing (Barro, 1979) cannot account for
the recent generalized increasing trend in public debt (PD), this paper improves the …