The effect of the behavior of an average consumer on the public debt dynamics

DOI10.1016/J.PHYSA.2017.04.099MaRDI QIDQ2147657zbMATH OpenOpenAlexFDO

Authors Roberto De Luca, Marco Di Mauro, Angelo Falzarano, Adele Naddeo

Publication date 20 June 2022

Published in Physica A (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1706.07759

zbMATH Keywords

macroeconomicsrepresentative agentpublic debt dynamics

Mathematics Subject Classification ID

Macroeconomic theory (monetary models, models of taxation) (91B64) Interest rates, asset pricing, etc. (stochastic models) (91G30)

Abstract: An important issue within the present economic crisis is understanding the dynamics of the public debt of a given country, and how the behavior of average consumers and tax payers in that country affects it. Starting from a model of the average consumer behavior introduced earlier by the authors, we propose a simple model to quantitatively address this issue. The model is then studied and analytically solved under some reasonable simplifying assumptions. In this way we obtain a condition under which the public debt steadily decreases.

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Cites work

• Interest Rates and Coupon Bonds in Quantum Finance
• Public debt, sustainability and economic growth. Theory and empirics
• Statistical mechanics of socio-economic systems with heterogeneous agents

Cited in

(3)

• On the (de)stabilizing effect of public debt in a Ramsey model with heterogeneous agents
• Inspecting debt servicing mechanism in Nigeria using ARMAX model of the Koyck kind
• Dynamics of public debt management

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