A wide variety of explanations has been offered for the rapid M1 growth since early 1985. One such explanation focuses on a possible increase in the interest elasticity of money demand. We use a nonstructural framework and begin by simply asking how an increase in the degree of substitutability...

Models in which fiscal and monetary authorities cooperate to minimize the distortionary costs of raising revenue to finance an exogenous stream of government expenditures are shown to have implications for the long-run relationships between government expenditures, tax revenues and seigniorage....

Previous tests of intertemporal budget balance and present value relationships have generally assumed either a constant discount rate or a constant expected discount rate. Empirical applications of these tests to the study of U.S. government deficits have produced conflicting results. This paper...