Publications

Working Paper No. 843 | July 2015

Is a Very High Public Debt a Problem?

This paper has two main objectives. The first is to propose a policy architecture that can prevent a very high public debt from resulting in a high tax burden, a government default, or inflation. The second objective is to show that government deficits do not face a financing problem. After these deficits are initially financed through the net creation of base money, the private sector necessarily realizes savings, in the form of either government bond purchases or, if a default is feared, “acquisitions” of new money.

Related Publications


Publication Highlight

Public Policy Brief No. 146
Stagnating Economic Well-Being and Unrelenting Inequality
Post-2000 Trends in the United States
Author(s): Ajit Zacharias, Thomas Masterson, Fernando Rios-Avila
August 2018

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