Rigas Oikonomou, Vincent Bodart, Luca Pensieroso, Fabio Mariani, David de la Croix

Research Projects

Sponsor Project Title IRES
Beginning End
National Bank of Belgium

Lack of coordination and debt management in a liquidity trap

Rigas Oikonomou   2019 2021
Project Description:

Standard macroeconomic models of optimal debt management (DM) assume that interest rates do not hit the zero-lower bound. Yet since 2009 and until 2015, the US has been in a liquidity trap (LT) with interest rates stuck at zero. We argue that the standard insights of the DM literature, that governments should issue long term and nominal debt, do not apply in LTs. We construct macroeconomic models of DM under a variety of institutional setups (experimenting with both coordinated and uncoordinated monetary and fiscal policies) to investigate the optimal structure of debt in a LT. When coordination is lacking between fiscal and monetary authorities, pursuing their respective objectives may lead to conflicting DM strategies with implications for macroeconomic volatility and welfare. Hence, we look at Markov perfect equilibria where the two authorities choose optimal policies and also intervene in the secondary market to buy debt from private agents. In this sense, our framework is suitable to talk about the Federal Reserve’s QE program and also about the debt issuance policies of the Treasury in the Great recession.


Sponsor Project Title IRES promoters IRES Researcher Beginning End
National Bank of Belgium

Essays in quantitative macroeconomics

Rigas Oikonomou      
Project Description:

This project is on quantitative macroeconomics, in particular on models of heterogeneous agents and on optimal fiscal policy models. A first paper analyzes the importance of the secondary market for durables, for the risk sharing opportunities in an incomplete financial market. A second paper is a DSGE model with optimal tax and debt policies applied to the US data.



Journal Articles

1. Bodart, Vincent; Ounnas, Alexandre. Prévision économique "en temps réel". In: Regards économiques, , no.164, p. 1-11 (2021). doi:10.14428/regardseco/2021.04.29.01.

2. Bodart, Vincent; Harrak, Pauline. Le dollar peut-il être détrôné ?. In: Regards économiques, , no.157, p. 1-8 (2020). doi:10.14428/regardseco/2020.10.29.01.

3. De Vroey, Michel. Should the history of macroeconomics steer clear of the fray or be partisan ? A critical essay on Banks and Finance in Modern Macroeconomics by B. Ingrao and C. Sardoni. In: Cahiers d'économie politique, , no.78, p. 1-11 (2020).

4. Attanasi, Gautier; Bodart, Vincent; Courtoy, François; Fontenay, Sébastien; Lachapelle, Nathan; Ounnas, Alexandre; Sauvenier, Mathieu. Perspectives économiques 2020. In: Regards économiques, , no.155, p. 1-11 (2020). doi:10.14428/regardseco/2020.01.17.01 (Soumis).

5. Attanasi, Gautier; Bodart, Vincent; Courtoy, François; Fontenay, Sébastien; Lachapelle, Nathan; Ounnas, Alexandre; Sauvenier, Mathieu. Perspectives économiques 2020-2021. In: Regards économiques, , no.156, p. 1-10 (2020). doi:10.14428/regardseco/2020.07.09.01.

6. Faraglia, Elisa; Marcet, Albert; Oikonomou, Rigas; Scott, Andrew. Government Debt Management: The Long and the Short of It. In: The Review of Economic Studies, Vol. 86, no.6, p. 2554-2604 (2019). doi:10.1093/restud/rdy061.

7. Attanasi, Gautier; Bodart, Vincent; Courtoy, François; Fontenay, Sébastien; Ounnas, Alexandre; Sauvenier, Mathieu. Perspectives économiques 2019. In: Regards économiques, , no.143, p. 1-9 (2019). doi:10.14428/regardseco/2019.01.11.01.

8. Pensieroso, Luca; Sommacal, Alessandro. Agriculture to industry: The end of intergenerational coresidence. In: Review of Economic Dynamics, Vol. 34, p. 87-102 (2019). doi:10.1016/

9. Bouakez, Hafedh; Oikonomou, Rigas; Priftis, Romanos. Optimal Debt Management in a Liquidity Trap. In: Journal of Economic Dynamics and Control, Vol. 93, p. 5-21 (August 2018). doi:10.1016/j.jedc.2018.01.033.

10. Oikonomou, Rigas. Unemployment Insurance with Limited Commitment Wage Contracts and Savings. In: The B.E. Journal of Macroeconomics, Vol. 18, no.1. doi:10.1515/bejm-2014-0162.

11. De Vroey, Michel. La théorie de l’équilibre général. In: Cahiers d'économie politique, , no.74, p. 197-205 (2018). doi:10.3917/cep.074.0197.

12. Mankart, Jochen; Oikonomou, Rigas. Household Search and the Aggregate Labour Market. In: The Review of Economic Studies, Vol. 84, no.4, p. 1735-1788 (2017). doi:10.1093/restud/rdw055.

13. Thornton, John; Vasilakis, Chrysovalantis. The impact of fiscal rules on sovereign risk premia: International evidence. In: Finance Research Letters, Vol. 20, p. 63-67 (2017). doi:10.1016/

14. Sneessens, Henri. Malinvaud on Macroeconomic Policy. In: Annals of Economics and Statistics, , no.125/126, p. 153-164 (June 2017).

15. De Vroey, Michel. Walker Donald A. and van Daal Jan , eds. and trans., Léon Walras, Elements of Theoretical Economics: or The Theory of Social Wealth (Cambridge: Cambridge University Press, 2014), pp. 588, $155. ISBN 978-1-107-06413-3.. In: Journal of the History of Economic Thought, Vol. 39, no.1, p. 144 - 147 (March 2017). doi:10.1017/S1053837216000560.

16. Danthine, Samuel; De Vroey, Michel. The Integration of Search in Macroeconomics: Two Alternative Paths. In: Journal of the History of Economic Thought, Vol. 39, no.4, p. 523-548 (2017). doi:10.1017/S1053837216000651.

17. De Vroey, Michel. Macroeconomics and the Phillips Curve Myth by James Forder. In: History of Political Economy, Vol. 49, no.4, p. 722-727 (2017). doi:10.1215/00182702-4296425.

18. Thornton, John; Vasilakis, Chrysovalantis. Inflation targeting and the cyclicality of monetary policy. In: Finance Research Letters, Vol. 20, p. 296-302 (2017). doi:10.1016/

19. Onali, Enrico; Ginesti, Gianluca; Vasilakis, Chrysovalantis. How should we estimate value-relevance models? Insights from European data. In: The British Accounting Review, Vol. 49, no.5, p. 460-473 (2017). doi:10.1016/

20. Thornton, John; Vasilakis, Chrysovalantis. Does inflation targeting reduce sovereign risk? Further evidence. In: Finance Research Letters, Vol. 18, p. 237-241 (2016). doi:10.1016/

21. Bodart, Vincent; Carpentier, Jean-François. Real exchange rates and skills. In: Journal of International Money and Finance : theoretical and empirical research in international economics and finance, Vol. 67, p. 305-319 (October 2016). doi:10.1016/j.jimonfin.2016.06.008.

22. De Vroey, Michel. Response to the Comments. In: Œconomia, Vol. 6, no.1, p. 149-152 (2016).

23. Mankart, Jochen; Oikonomou, Rigas. The rise of the added worker effect. In: Economics Letters, Vol. 143, p. 48-51 (June 2016). doi:10.1016/j.econlet.2016.03.019.

Book Chapters

1. Clerc, Pierrick; De Vroey, Michel. Brunner versus Friedman : Diverging Aspirations for the Monetarist Project. In: Karl Brunner and Monetarism , MIT Press: Cambridge, 2020, p. 1-16. xxx xxx.

2. Clerc, Pierrick; De Vroey, Michel. Robert Lucas. In: The Palgrave Companion to Chicago Economics and Economists , Palgrave-MacMillan, 2020. xxx xxx.

3. De Vroey, Michel; Malgrange, Pierre. Macroeconomics : The History of Macroeconomics from Keynes’s General Theory to the Present. In: Handbook on the History of Economic Analysis Volume III : Developments in Major Fields of Economics , Edward Elgar: Cheltenham, 2016, p. 372-390. 978-1-84980-112-6. xxx xxx. doi:10.4337/9781785365065.

Working Papers

1. Bodart, Vincent; Courtoy, François; Erica Perego. World interest rates and macroeconomic adjustments in developing commodity producing countries. 2021. 31 p. LIDAM Discussion Paper IRES/2021/02.

2. Mariani, Fabio; Mercier, Marion; Pensieroso, Luca. Left-Handedness and Economic Development. 2021. 68 p. IZA Discussion Paper 14237.

3. Pensieroso, Luca; Restout, Romain. The Gold Standard and the International Dimension of the Great Depression. 2021. 43 p. Documents de travail BETA (Bureau d'Economie Théorique et appliquée 2021-21.

4. Courtoy, François; De Vroey, Michel; Turati, Riccardo. What do we teach in Macroeconomics? Evidence of a theoretical divide. 2021. 33 p. LIDAM Discussion Paper IRES/2021/23.

5. de Beauffort, Charles. Fiscal And Monetary Policy Interactions In A Liquidity Trap When Government Debt Matters. 2020. 42 p. IRES Discussion papers 2020033.

6. Bodart, Vincent; Jean-François Carpantier. Currency Collapses and Output Dynamics in Commodity Dependent Countries. 2019. 35 p. IRES Discussion papers 2019011.

7. Deseau, Arnaud; Levai, Adam; Lauwers, Michèle. Access to Justice and Economic Development: Evidence from an International Panel Dataset. 2019. 45 p. IRES Discussion papers 2019009.


1. De Vroey, Michel. A History of Macroeconomics from Keynes to Lucas and Beyond. Cambridge University Press: New york, 2016. 978-1-107-58494-5. 445 pages.