Dell'Erba, Salvatore; Sola, Sergio - International Monetary Fund (IMF) - 2013
This paper reconsiders the effects of fiscal policy on long-term interest rates employing a Factor Augmented Panel (FAP … variables for a panel of OECD countries for the period 1989-2012. We find that two global factors—the global monetary and fiscal … policy stances—explain more than 60 percent of the variance in the long-term interest rates. Compared to the estimates from …