debt in a liquidity trap by increasing taxes and by taming public spending. This prescription is at odds with large deficit …-spending undertaken in the US during previous liquidity trap episodes. In this article, I show that accumulating debt turns optimal with …. Moreover, even when labor taxes fluctuate and policy is fully coordinated, optimal deficit-spending in a liquidity trap emerges …

against macroeconomic shocks to the government budget. Whether this goal is better accomplished by nominal or inflation …-indexed debt, by a short or a long maturity structure, remains however controversial. In this paper we review the issues of … indexation and debt maturity, discussing in particular the role of the maturity structure in light of integrated financial …