Cao, Ziyi; Ou, Zhirong - 2021 - First draft: October 2020
A measure of the degree of debt monetisation is constructed for its impact on the business cycle to be studied in a … standard VAR model. Debt monetisation is hardly expansionary, as it raises public demand that crowds out almost as much demand … impact of debt monetisation on the business cycle dynamics is trivial, due to the low e¢ ciency of the monetary transmission …