bobcat2
Joined: 20 Feb 2007
Posts: 1936
|
 Posted: Mon Aug 13, 2007 8:39 pm Post subject: The Invention of Inflation-Linked Bonds in Early America |
 |
|
Discussion paper at the Cowles Foundation by Robert Shiller -
| Quote: | The world’s first known inflation-indexed bonds were issued by the Commonwealth of
Massachusetts in 1780 during the Revolutionary War. These bonds were invented to deal with
severe wartime inflation and with angry discontent among soldiers in the U.S. Army with the
decline in purchasing power of their pay. Although the bonds were successful, the concept of
indexed bonds was abandoned after the immediate extreme inflationary environment passed, and
largely forgotten until the twentieth century. In 1780, the bonds were viewed as at best only an
irregular expedient, since there was no formulated economic theory to justify indexation.
|
link to paper: http://cowles.econ.yale.edu/P/cd/d14a/d1442.pdf
Bob K
_________________
The real difficulty in changing any enterprise lies not in developing new ideas, but in escaping from the old ones. - JM Keynes
Good questions outrank easy answers. - PA Samuelson |
|
Wiki
FAQ
Search
Memberlist
Usergroups
Register
Profile
Log in to check your private messages
Log in
