Debt management and fiscal insurance

Accounting

1999

ESRC Regard

The project aims to examine how debt management can be used to support fiscal policy - that is to use changes in debt interest payments to insulate tax and expenditure plans from shocks to the economy. It does so by considering how debt should respond optimally to shocks to the fiscal deficit assuming both complete and incomplete financial markets. We intend to examine this issue using theory, simulations and econometrics. Our aim is to use our analysis to test the extent of market incompleteness for government debt. We also intend to provide a conceptual framework within which to consider debt management and fiscal policy and to make explicit recommendations for how the UK and other OECD government should structure their debt portfolio to optimally support fiscal policy.

research grant

Andrew Scott

ascott@london.edu

Andrew Scott

ESRC

36

http://www.regard.ac.uk/cgi-bin/regardng/zQuery.pl?host=137.222.16.110&port=8222&dbase=rngTestbed&thisUrl=http://www.regard.ac.uk/regard/home/index_html?&actionUrl=/cgi-bin/regardng/zQuery.pl&parsedQuery=1%3D1007++a995037528n882&attribute=control&boolean=

Scott A; Marcet A

No

10/01/1999