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Race to the debt trap? : spatial econometric evidence on debt in German municipalities

Fossen, Frank M.; Freier, Ronny; Martin, Thorsten - 2014

Through an intertemporal budget constraint, jurisdictions may gain advantages in tax and spending competition by 'competing' on debt. While the existing spatial econometric literature focuses on tax and spending competition, very little is known about spatial interaction via public debt. This...

Persistent link: https://www.econbiz.de/10010233999

The effect of self-control on borrowing : experimental evidence

Grohmann, Antonia; Hamdan, Jana S. - 2020

This paper examines the effect of reduced self-control on debt-taking in a laboratory experiment. We manipulate self-control using an ego depletion task and show that it is effective. Following the ego depletion task, participants can anonymously buy hot drinks on credit. We find no significant...

Persistent link: https://www.econbiz.de/10012500130

Sovereign risk and bank fragility

Anand, Kartik; Mankart, Jochen - 2020

We develop a model of bank risk-taking with strategic sovereign default risk. Domestic banks invest in real projects and purchase government bonds. While an increase in bond purchases crowds out profitable investments, it improves the government's incentives to repay and therefore lowers its...

Persistent link: https://www.econbiz.de/10012301195

Public investment, national debt, and economic growth : the role of debt finance under dynamic inefficiency

Tamai, Toshiki; Kamiguchi, Akira - 2020

Persistent link: https://www.econbiz.de/10012488080

Selective default expectations

Accominotti, Olivier; Albers, Thilo N. H.; Oosterlinck, Kim - 2023

This paper explores how selective default expectations affect the pricing of sovereign bonds in a historical laboratory: the German default of the 1930s. We analyze yield differentials between identical government bonds traded across various creditor countries before and after bond market...

Persistent link: https://www.econbiz.de/10014495920

Monetary-fiscal policy interaction and fiscal inflation : a tale of three countries

Kliem, Martin; Kriwoluzky, Alexander; Sarferaz, Samad - 2015

fiscal stance and inflation using crosscountry data from 1965 to 1999. In a first step, we contrast the monetary … that the low-frequency relationship between the fiscal stance and inflation is low during periods of an independent central … illustrate the mechanisms through which fiscal actions affect inflation in the long run. The findings from the DSGE model suggest …