The paper develops a forward-looking comprehensive accounting framework for the public sector. By integrating the public sector budget constraint forward in time the government's present value budget constraint (PVBC) is obtained. In addition to the familiar financial assets and liabilities,...

The paper surveys and extends recent results on the effect of changes in government fiscal and financial policy, and in private savings behaviour, on economic growth. Private saving behaviour is represented by an overlapping generations (OLG) model. The supply side of the model permits...

The paper studies the causes of the current financial crisis and considers proposals for mitigation and prevention of future crises. The crisis is was the product of a ‘perfect storm’ bringing together a number of microeconomic and macroeconomic pathologies. Among the microeconomic systemic...

The paper uses a 'demand for seigniorage revenue' and 'supply of seigniorage revenue' approach to determine the consequences of cuts in public spending for the rate of inflation. Monetary financing is viewed as the residual financing mode, with tax rates and public debt/GDP ratios held constant....

The paper provides an account of the current global economic situation, outlook and policy options. Medium-term prospects are mediocre and fraught with considerable downside risk. Fiscal and monetary policy options for the main industrial countries to improve global economic performance are...

The paper studies the effects of alternative financing policies in the open economy. There is a non-trivial role for financing policy because of the failure of first-order debt neutrality due to uncertain private lifetimes. Both the single-country case and the interdependent two-country case are...

The paper develops a two-country endogenous growth model to investigate possible causes for the existence and persistence of productivity growth differentials between nations, even though these countries show a common technology, constant returns to scale and perfect international capital...

Governments through the ages have appropriated real resources through the monopoly of the ‘coinage’. In modern fiat money economies, the monopoly of the issue of legal tender is generally assigned to an agency of the state, the Central Bank, which may have varying degrees of operational and...

We investigate how the ability of the government to depart from budget balance and issue debt expands the set of equilibria that can be supported using lump-sum tax-transfer instruments. We show how this depends on the restrictions that exist on the capacity to tax and make transfer payments,...

This paper surveys some recent developments in policy evaluation and design in continuous time linear rational expectations models. Much recent work in macroeconomics and open economy macroeconomics fits into this category. First the continuous time analogue of the discrete time solution method...