Crowding Out, Deficits, and Interest Rates: Reply

Cebula, Richard (1987): Crowding Out, Deficits, and Interest Rates: Reply. Published in: Public Choice , Vol. 58, No. 1 (21 July 1988): pp. 95-97.

Abstract

This Note endeavors to illustrate the relevance of the impact of the budget deficit upon the interest rate to the issue of crowding out. It is argued that empirical studies of the impact of deficits upon interest rates may be very useful in det­ermining whether (and how) crowding out occurs, but that additional empirical analysis involving the interest sensitivity of commodity market demand is needed to then determine the degree of crowding out.

• Item Type: MPRA Paper
• Language: English
• Keywords: budget deficits; crowding out; interest rates
• Subjects: G - Financial Economics > G1 - General Financial Markets > G12 - Asset Pricing ; Trading Volume ; Bond Interest Rates; H - Public Economics > H6 - National Budget, Deficit, and Debt > H62 - Deficit ; Surplus; H - Public Economics > H6 - National Budget, Deficit, and Debt > H69 - Other

References

Cebula, R.J. (1987). Federal deficits and the real rate of interest in the United States: A note. Public Choice 53 (January): 97-100.

Holloway, T. M. (1986). The cyclically adjusted federal budget and federal debt: Revised and updated estimates. Survey of Current Business 66 (March): 11-17.