For a sample of sixteen OECD countries over the period 1980-2007 we show that, for given debt-GDP ratio, an increase in … the maturity of the public debt by one year lowers its long-term interest rate by around 20-30 basis points. This effect … is stronger for countries with higher average inflation or debt. …

We propose a theory of indebted demand, capturing the idea that large debt burdens by households and governments lower … accommodative monetary policy and deficit spending—generate a debt-financed short-run boom at the expense of indebted demand in the … future. When demand is sufficiently indebted, the economy gets stuck in a debt-driven liquidity trap, or debt trap. Escaping …

interest on the national debt is set in private credit markets – in fact are not applicable to governments issuing their own …

can be more stimulative than a debt-financed fiscal expansion of equal magnitude. However, the extra stimulus requires … money financing avoids the adverse wealth effects associated with higher taxes under debt financing. Because the stimulative … effects of money financing are driven by its implications for interest rates, a combination of debt financing and sufficiently …