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the model used in this paper, savings and investment are co-determined through adjustments in the real interest rate, and … quantitatively large. For plausible parameter values, the differences in growth rates, savings rates and investment rates are of the … of overlapping generations, in the context of a class of endogenous growth theories with investment adjustment costs. In …
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This essay discusses the reasons for and implications of the decline in real interest rates around the world over the past several decades. It suggests that the decline in interest rates is largely explicable from trends in saving, growth, and markups. In this environment, greater government...
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