Public debt financing through political processes: a review essay of Olivier Blanchard’s Fiscal Policy under Low Interest Rates

Jonathan W. Plante
{"title":"Public debt financing through political processes: a review essay of Olivier Blanchard’s Fiscal Policy under Low Interest Rates","authors":"Jonathan W. Plante","doi":"10.1332/25156918y2023d000000001","DOIUrl":null,"url":null,"abstract":"In his recent book Fiscal Policy under Low Interest Rates , Olivier Blanchard argues that when interest rates are low, policymakers can use public debt finance to increase the welfare of a nation. I argue that Blanchard’s model suffers from the “organismic theory of the State” and, as such, reaches dubious conclusions. At its core, an organismic model presumes that politicians can and do make transfers that maximize the welfare of all individuals. While this is, of course, plausible, an individualistic view states that whether government transfers increase welfare for all individuals depends on the political decision-making process of time and place. While some political processes redistribute funds equally, others redistribute unequally—that is, they increase welfare for some but decrease the welfare of others. Blanchard’s organismic model takes this fact for granted. I use the individualistic view to argue that even if interest rates are low, if a political process is one that redistributes unequally, transfers under public debt financing can result in or exacerbate income inequality. To illustrate this point, I show that in the US, increases in public debt financing have increased welfare for some individuals—the low- and upper-income quintiles—but have decreased it for others—the middle-income quintiles.","PeriodicalId":53126,"journal":{"name":"Journal of Public Finance and Public Choice","volume":"29 1","pages":"0"},"PeriodicalIF":0.5000,"publicationDate":"2023-10-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Public Finance and Public Choice","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1332/25156918y2023d000000001","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q4","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0

Abstract

In his recent book Fiscal Policy under Low Interest Rates , Olivier Blanchard argues that when interest rates are low, policymakers can use public debt finance to increase the welfare of a nation. I argue that Blanchard’s model suffers from the “organismic theory of the State” and, as such, reaches dubious conclusions. At its core, an organismic model presumes that politicians can and do make transfers that maximize the welfare of all individuals. While this is, of course, plausible, an individualistic view states that whether government transfers increase welfare for all individuals depends on the political decision-making process of time and place. While some political processes redistribute funds equally, others redistribute unequally—that is, they increase welfare for some but decrease the welfare of others. Blanchard’s organismic model takes this fact for granted. I use the individualistic view to argue that even if interest rates are low, if a political process is one that redistributes unequally, transfers under public debt financing can result in or exacerbate income inequality. To illustrate this point, I show that in the US, increases in public debt financing have increased welfare for some individuals—the low- and upper-income quintiles—but have decreased it for others—the middle-income quintiles.
查看原文
分享 分享
微信好友 朋友圈 QQ好友 复制链接
本刊更多论文
政治过程中的公共债务融资:对奥利维尔·布兰查德《低利率下的财政政策》的评论文章
奥利维尔•布兰查德(Olivier Blanchard)在他的新书《低利率下的财政政策》(Fiscal Policy under Low Interest Rates)中指出,当利率处于低位时,政策制定者可以利用公共债务融资来增加一个国家的福利。我认为,布兰查德的模型受到了“国家有机体理论”的影响,因此得出了可疑的结论。有机模型的核心假设是,政治家能够而且确实进行了使所有个人福利最大化的转移支付。虽然这当然是合理的,但个人主义的观点认为,政府转移支付是否会增加所有人的福利,取决于时间和地点的政治决策过程。虽然有些政治过程对资金的再分配是平等的,但有些则是不平等的——也就是说,它们增加了一些人的福利,但减少了另一些人的福利。布兰查德的有机体模型将这一事实视为理所当然。我用个人主义的观点认为,即使利率很低,如果一个政治过程是一个再分配不平等的过程,公共债务融资下的转移支付也会导致或加剧收入不平等。为了说明这一点,我展示了在美国,公共债务融资的增加增加了一些人(低收入和高收入的五分之一)的福利,但却减少了另一些人(中等收入的五分之一)的福利。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
求助全文
约1分钟内获得全文 去求助
来源期刊
CiteScore
1.00
自引率
33.30%
发文量
0
期刊最新文献
Polycentric governance in practice: the case of Ukraine’s decentralised crisis response during the Russo-Ukrainian war Strategic changes in the public sphere: modern prerequisites for effective management Lack of consensus, dispersion of political power and public debt: evidence from a sample of developed countries Public debt financing through political processes: a review essay of Olivier Blanchard’s Fiscal Policy under Low Interest Rates Public choice economics of the Ukraine crisis
×
引用
GB/T 7714-2015
复制
MLA
复制
APA
复制
导出至
BibTeX EndNote RefMan NoteFirst NoteExpress
×
×
提示
您的信息不完整,为了账户安全,请先补充。
现在去补充
×
提示
您因"违规操作"
具体请查看互助需知
我知道了
×
提示
现在去查看 取消
×
提示
确定
0
微信
客服QQ
Book学术公众号 扫码关注我们
反馈
×
意见反馈
请填写您的意见或建议
请填写您的手机或邮箱
已复制链接
已复制链接
快去分享给好友吧!
我知道了
×
扫码分享
扫码分享
Book学术官方微信
Book学术文献互助
Book学术文献互助群
群 号:481959085
Book学术
文献互助 智能选刊 最新文献 互助须知 联系我们:info@booksci.cn
Book学术提供免费学术资源搜索服务,方便国内外学者检索中英文文献。致力于提供最便捷和优质的服务体验。
Copyright © 2023 Book学术 All rights reserved.
ghs 京公网安备 11010802042870号 京ICP备2023020795号-1