What would happen if the Federal Reserve were to change the assets in its portfolio? Suppose that instead of using open-market operations in Treasury securities to increase the monetary base, the Fed were to engage in open-market operations in private securities or to use discount loans via a...

This paper demonstrates the usefulness and simplicity of the overlapping-generations model for analyzing certain types of macroeconomic problems. An overlapping-generations model is used to clarify and interpret some existing neutrality theorems concerning government debt and monetization. The...