A Continuous-Time Model of the Term Structure of Interest Rates with Fiscal-Monetary Policy Interactions

We study the term structure implications of the fiscal theory of price level determination. We introduce the intertemporal budget constraint of the government in a general equilibrium model in continuous time. Fiscal policy is set according to a simple rule whereby taxes react proportionally to real debt. We show how to solve for the prices of real and nominal zero coupon bonds

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Year of publication:	[2013]
Authors:	Marzo, Massimiliano
Other Persons:	Romagnoli, Silvia (contributor) ; Zagaglia, Paolo (contributor)
Publisher:	[2013]: [S.l.] : SSRN

Extent:	1 Online-Ressource (38 p)
Series:	Bank of Finland Research Discussion Paper ; No. 25/2008
Type of publication:	Book / Working Paper
Notes:	Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments October 24, 2008 erstellt
Other identifiers:	10.2139/ssrn.1300929 [DOI]
Classification:	D91 - Intertemporal Consumer Choice; Life Cycle Models and Saving ; E43 - Determination of Interest Rates; Term Structure Interest Rates ; E61 - Policy Objectives; Policy Designs and Consistency; Policy Coordination ; G12 - Asset Pricing
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10012710916