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The Natural Interest Rate and Secular Stagnation

December 1, 2016
The Natural Interest Rate and Secular Stagnation Vladislav Reshetnyak

This paper reviews literature and theory on macroeconomics' use of the "natural" interest rate.

The "natural" interest rate in loanable funds macroeconomic models doesn't always fit the data. New Keynesian models, in which economic performance is determined by loanable funds, are inconsistent with macroeconomic data.

Authors: Lance Taylor
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