Acharya, Viral V.; Rajan, Raghuram G.; Shim, Jack - 2022
We examine the dynamics of a country’s growth, consumption, and sovereign debt, assuming that the government is myopic … and wants to maximize short-term, self-interested spending. Surprisingly, government myopia can increase a country …’s access to external borrowing. In turn, access to borrowing can extend the government’s effective horizon; the government …