This paper presents a continuous‐time model of sovereign debt. In it, a relatively impatient sovereign government's hidden type switches back and forth between a commitment type, which cannot default, and an opportunistic type, which can, and where we assume outside lenders have particular...

This paper presents a full characterization of the equilibrium value set of a Ramsey tax model. More generally, it develops a dynamic programming method for a class of policy games between the government and a continuum of households. By selectively incorporating Euler conditions into a...

This paper provides an empirical analysis of how the U.S. Social Security and Medicare system affects the labor supply of older males in the presence of incomplete markets. The authors estimate a dynamic programming model of the joint labor supply and Social Security acceptance decision. The...