TY  - JOUR
AU  - Persson,Torsten
TI  - Deficits and Intergenerational Welfare in Open Economies
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 1083
PY  - 1983
Y2  - February 1983
UR  - http://www.nber.org/papers/w1083
L1  - http://www.nber.org/papers/w1083.pdf
N1  - Author contact info:
Torsten Persson
Torsten and Ragnar Soderberg Chair in Economic Sci
Institute for International Economic Studies
Stockholm University
SE-106 91 Stockholm
SWEDEN
Tel: +46 8 163066
Fax: +46 8 6747801
E-Mail: Torsten.Persson@iies.su.se
AB  - This paper deals with public debt in open economies, extending Diamond's overlapping generations model to deal with a small openeconor as well as an international eciuilibrium of two large economies. It focuses on the intergenerational welfare redistributions caused by an increase in the public debt triggered by a period of government budget deficit, and shows that these effects are markedly different in open and closed economies. The interplay between the deficits in the government budget and the current account is also analyzed. Here, it is shown how a single period with a deficit in the government budget can be followed by a seciuence of periods with a deficit in the current account.
ER  -