Reda, Cherif; Fuad, Hasanov - Volkswirtschaftliche Fakultät, … - 2010
We study the dynamics of U.S. public debt in a parsimonious VAR. We find that including debt feedback ensures the … stationarity of debt while standard VARs excluding debt may imply an explosive debt path. We also find that the response of debt to … inflation increases debt while the same to interest rate decreases it. Positive shocks to growth and primary surplus …