How Do Government Deficits And Debt Affect U.s. Economic...

Annotated Bibliography The research question evaluated in this annotated bibliography is â€Å"How do government deficits and debt affect U.S. economic welfare?† The research question addressed by this article is how do deficit and debt effect interest rates? The article begins by showing the complexity of measuring these elements do to the business cycle and its effects on the variables. The author proposes the best way to measure deficit and debts effect on interest rates is to take future values for interest rates and the projected amounts of debt and deficit. This allows for the variables to be measured outside of the business cycle and this providing a cleaner measurement of the different variables. By using debt and deficit projections†¦show more content†¦This theoretical success of the Ponzi gamble makes it feasible for the United States to continually rollover debt with any determent to welfare of future generations. The research question addressed by this article is â€Å"do large deficits produce high interest rates?† The hypothesis of the author is that large deficits do not increase interest rates. The author examines four major time periods in United States history and measures exogenous influences such as government spending, tax revenue, and nominal money stock. Regression analysis is applied to these factors. The author concludes that high deficits do not have the impact on interest rates as had previously been assumed The research question addressed by this article is â€Å"what is the relationship between public and private debt?† First, the article explains the unique negative covariation which occurred between U.S. public and private debt up until the 1980’s. The author then analyses the post 1980 debt-to-income ratio, and find that both public and private debt have increased since 1980. The research question addressed by this article is â€Å"what is the effect of both implicit and explicit debt on long-term interest rates?† The study seeks to find the effects of implicit and explicit debt, and while most studies have focused on explicit debt this study takes an in depth look at the implicit debt and the impact it has on interest rates. Using VAR analyses, the authors find