I analyze how lack of commitment affects the maturity structure of sovereign debt. Ex post, the government trades off the gains from default induced redistribution against the cost of defaulting. Ex ante, the government issues debt of various maturities to raise an exogenous revenue requirement....

We analyze the sustainability of intergenerational transfers in politico-economic equilibrium. We argue that these transfers naturally arise in a Markov perfect equilibrium in the fundamental state variables. In contrast to earlier literature, our explanation does not resort to altruism,...

In this paper we analyze tax and transfer choices in an OLG economy with capital accumulation and endogenous growth coming from public investment, such as education. We solve for a Markov perfect equilibrium when electoral competition targets the votes of young and old households. We find that...