Togo, Eriko2012-06-072012-06-072007-09https://hdl.handle.net/10986/7389This paper proposes a sovereign asset and liability management framework for analyzing the inter-relationships between debt management, fiscal and monetary policies. It illustrates the consequences of uncoordinated policy mix and extends Sargent and Wallace (1981 and 1993) by including debt management. Examples of policy games played by fiscal, monetary, and debt management authorities reinforce the importance of policy separation and coordination to prevent domination by one authority over another which could lead to inconsistent policy mix.CC BY 3.0 IGOAMOUNT OF DEBTASSET LIABILITY MANAGEMENTASSET PRICESBALANCE SHEETSBANK BALANCE SHEETBANK POLICYBANKING SECTORBINDING CONSTRAINTBONDBOND ISSUANCEBONDSBUDGET CONSTRAINTBUDGET DEFICITBUDGET DEFICITSBUSINESS CYCLEBUSINESS CYCLESBUYBACKSCAPITAL FLOWSCAPITAL INFLOWSCAPITAL LOSSESCAPITAL MARKETSCENTRAL BANKCOMMITMENT DEVICECOMPOSITION OF DEBTCONFLICT OF INTERESTCONTINGENT LIABILITIESCREDIBILITYCREDITORDEBT BURDENDEBT COMPOSITIONDEBT CRISISDEBT INSTRUMENTDEBT INSTRUMENTSDEBT ISSUANCEDEBT LEVELDEBT LEVELSDEBT MANAGEMENT AUTHORITIESDEBT MANAGEMENT DEPARTMENTDEBT MANAGEMENT POLICIESDEBT MANAGEMENT POLICYDEBT MANAGEMENT RESPONSIBILITIESDEBT MANAGEMENT STRATEGYDEBT MANAGERDEBT MANAGERSDEBT MATURITYDEBT OBLIGATIONSDEBT PORTFOLIODEBT SERVICEDEBT SERVICE PAYMENTSDEBT SERVICINGDEBT SERVICING COSTDEBT SERVICING COSTSDEBT STRATEGYDEBT STRUCTUREDEBT STRUCTURESDEBT SWAPSDECENTRALIZATIONDEGREE OF RISKDEVALUATIONDEVELOPING COUNTRIESDISCOUNT RATEDOMESTIC BONDSDOMESTIC CURRENCYDOMESTIC DEBTDOMESTIC DEBT MARKETDOMESTIC INTEREST RATESDOMESTIC MARKETEFFICIENT MARKETEMERGING ECONOMIESEMERGING MARKETEMERGING MARKET ECONOMIESEMERGING MARKETSEVOLUTION OF DEBTEXCHANGE RATEEXCHANGE RATE REGIMEEXCHANGE RATESEXPENDITUREEXPENDITURESEXTERNAL DEBTFEDERAL RESERVEFEDERAL RESERVE BANKFINANCIAL CRISESFINANCIAL CRISISFINANCIAL MARKETSFINANCIAL SHOCKFISCAL AUTHORITIESFISCAL DEFICITFISCAL DEFICITSFISCAL POLICIESFISCAL POLICYFIXED EXCHANGE RATEFIXED RATEFLOATING RATEFLOATING RATE DEBTFOREIGN CURRENCYFOREIGN CURRENCY DEBTFOREIGN CURRENCY EXPOSUREFOREIGN DIRECT INVESTMENTFOREIGN EXCHANGEFOREIGN EXCHANGE MARKETGOVERNMENT ASSETSGOVERNMENT BONDSGOVERNMENT BUDGETGOVERNMENT DEBTGOVERNMENT DEBT MARKETSGOVERNMENT DEFICITSGOVERNMENT EXPENDITUREGOVERNMENT FINANCEGOVERNMENT FINANCESGOVERNMENT PAPERGOVERNMENT POLICYGOVERNMENT REVENUEGOVERNMENT REVENUESGOVERNMENT SPENDINGHEDGESINCOMEINCOME TAXESINFLATIONINFLATION RATEINFLATION RATESINFLATION TARGETINFLATIONARY EXPECTATIONSINITIAL DEBTINSTITUTIONAL ARRANGEMENTS FOR DEBT MANAGEMENTINSTRUMENTINSURANCEINSURANCE PREMIUMINTEREST COSTINTEREST COSTSINTEREST PAYMENTSINTEREST RATEINTEREST RATE POLICIESINTEREST RATESINTERNATIONAL BANKINTERNATIONAL CAPITALINVESTINGLESS DEVELOPED ECONOMIESLEVEL OF DEBTLIABILITYLIABILITY MANAGEMENTLIQUIDITYLIQUIDITY CRISISLOCAL CURRENCYLONG-TERM DEBTLONG-TERM INTERESTLONG-TERM INTEREST RATESMACROECONOMIC CRISESMACROECONOMIC POLICIESMACROECONOMIC POLICYMACROECONOMIC RISKSMACROECONOMIC STABILIZATIONMARGINAL UTILITY OF CONSUMPTIONMARKET FOR GOVERNMENT SECURITIESMATURITIESMONETARY AUTHORITIESMONETARY AUTHORITYMONETARY FUNDMONETARY POLICIESMONETARY POLICYMONEY SUPPLYNATIONAL DEBTNATIONAL DEBT OFFICENATIONAL SAVINGSNATIONAL TREASURYNEGATIVE SHOCKNEGATIVE SHOCKSOPEN MARKETOUTPUTPAYMENT OBLIGATIONSPOLICY CREDIBILITYPOLICY RESPONSEPORTFOLIOPRICE STABILITYPRIMARY MARKETPUBLIC DEBTPUBLIC DEBT MANAGEMENTPUBLIC FINANCEPUBLIC FINANCESRATES OF RETURNREAL INTERESTREAL INTEREST RATESRESERVERESERVE REQUIREMENTSRESERVESRETURN ON ASSETRETURNSRISK AVERSE INVESTORRISK AVERSIONRISK MANAGEMENTRISK PREMIUMRISK PREMIUMSRISKY ASSETSECONDARY MARKETSECURITIESSEIGNIORAGESHORT MATURITYSHORT TERM DEBTSHORT-TERM BORROWINGSHORT-TERM DEBTSHORT-TERM INTEREST RATESSOLVENCYSOVEREIGN DEBTSTABILIZATION POLICYSTATE CONTINGENT DEBTSTOCK OF DEBTSWAPSTAXTAX POLICYTAX RATETAX RATESTREASURYUNDERDEVELOPED DEBT MARKETVIRTUOUS CYCLEVOLATILITYWorld Bank10.1596/1813-9450-4369