Most recent Working Papers
Working Papers present research work by both Danmarks Nationalbank’s employees and our partners. Working Papers are primarily targeted at professionals and people with an interest in central banking research as well as economics and finance in a broader sense.
Working Paper: Drivers of Real Interest Rates in A Two-country, General-equilibrium, OLG Model
We examine drivers of the equilibrium real interest rate in a two-country, general-equilibrium, OLG model. The model predicts that population growth, growth in technology, and increased longevity have reduced the equilibrium real interest rate by 2.25 percentage points from 1950 until today – and that these factors will pull it down by further 0.25 percentage points towards 2050. Differences in longevity may explain the build-up of the large Danish net foreign asset position.