The Effects of Government Expenditure on the Term Structure of Interest Rates
在Blinder-Solow动态模型中引入短期和长期利率，通过套利机制分析政府支出如何影响不同期限的利率，对研究财政政策与金融市场关系的学者有参考价值。
MOST FORMAL MACROECONOMIC MODELS treat all assets as being of common maturity. Typically, this is assumed to be either extremely (infinitesimally) short (a short-term bill) or infinitely long (a perpetuity). In reality, of course, there is a whole spectrum of assets in existence, having varying times to maturity. Moreover, different agents in the markets are concerned with rates of return extending over different time horizons. Participants in asset markets can typically adjust their portfolios virtually instantaneously, so that some short-run rate of return is appropriate as an argument of the relevant asset demand functions. On the other hand, investors in physical equipment are typically locked into some longterm financial arrangement, in which case it is some long-term rate that is the appropriate argument of the investment function. Provided that the financial markets operate efficiently, arbitrage by participants in the asset markets will bring the instantaneous rates of return on assets of varying maturities into equality. l In this paper, we introduce both a short rate and a long rate into a simple dynamic macroeconomic model. The framework we employ is the familiar Blinder-Solow ( 1973) model. It is shown how, through arbitrage, the current long rate at any point