The Role of Government in the Credit Market
The paper assumes a government advantage in collecting income contingent payments and develop a proposal for a government loan program that is an integral part of the tax system. The focus is on administrative costs and the difference between the collection technologies available to the public and the private sectors. In the process of developing the proposal the paper addresses some theoretical issues in the field of monetary economics and public finance. Among the questions addressed are: the optimality of the Friedman rule, the optimal interest rate(s), and the desirability of money substitutes and privately created bubbles.
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Eden, Benjamin (Vanderbilt University, 2007)The welfare gains from adopting a zero nominal interest policy depend on the implementation details. Here I focus on a government loan program that crowds out lending and borrowing and other money substitutes. Since money ...
Eden, Benjamin (Vanderbilt University, 2008)The welfare gains from adopting a zero nominal interest policy depend on the implementation details. Here I argue that implementing the Friedman rule by a government loan program may be better than implementing it by ...
Stroup, Caleb; Zissimos, Ben (Vanderbilt University, 2010)This paper shows how a nation's elite maintain ownership of their wealth by creating a `pampered bureaucracy.' The elite thus divert part of an otherwise entrepreneurial middle class from more productive manufacturing ...