Government debt and assets
All governments can better manage their resources. They should start by bringing data together to come up with a rough estimate of public sector assets, liabilities, and wealth. Once governments complete this exercise they will be able to show their citizens the full extent of what they own and owe, and better use public wealth to meet society’s economic and social goals.
Government Debt Is Not the Whole Story: Look at the Assets
By: IMF
What is the optimal debt maturity distribution
Flat!
Debortoli and al. analyzed optimal fiscal policy under lack of commitment and established that such a policy may not coincide with that under commitment, even if the government can issue a rich maturity structure of debt. They show that the unique stable maturity structure of government debt is flat, with the government owing the same amount of resources to the private sector at all future dates.
Optimal Taxation and Debt Management without Commitment
Authors: Davide Debortoli, Ricardo Nunes, Pierre Yared
From: Pompeu Fabra University, University of Surrey, Columbia University
A function of liquidity frictions
The optimal issuance of any bond equals the product of the liquidity coefficient times the difference between the market price and the domestic valuation. This property holds in presence of income or interest-rate risk and the option to default.
A Framework for Debt-Maturity Management
Authors:Saki Bigio, Galo Nuno, Juan Passadore,
From:University of California-Los Angeles, Bank of Spain, Einaudi Institute for Economics and Finance
