The overlapping-generations model is defined by its particular (but very natural) demographic structure. Following Samuelson's lead, applications of the overlapping-generations model frequently involve taxes and transfers denominated in money.  Balasko and Shell provide the basic analysis of these money taxes and transfers in both the OG economy and the finite horizon economy.  The set of bonafide fiscal policies — those money taxes and transfers that permit money to have positive value — satisfies "absence of money illusion" (but not necessarily the quantity theory).  The set of equilibrium money prices is not in general connected.   Asymptotic retirement of the public debt is neither necessary nor sufficient for bonafidelity.

For finite economies, matters are simpler: (1) Fiscal policies that are not balanced are not bonafide.  (2) If consumers are productively-related (or if the economy is irreducible), then balanced policies are bonafide.  See Balasko and Shell (1985, 1993.)

• "Monnaie et allocation intertemporelle" [title and abstract in French, text in English] mimeo., Séminaire Roy-Malinvaud, Centre National de la Recherche Scientifique, Paris, November 21, 1977. To appear as a Vintage Unpublished Article in Macroeconomic Dynamics.

• "The Overlapping-Generations Model, II: The Case of Pure Exchange with Money" (with Yves Balasko), Journal of Economic Theory, Vol. 24(1), February 1981, 112-142. See also "Erratum," Journal of Economic Theory, Vol. 25(3), December 1981, 471.

• "The Overlapping-Generations Model, III: The Case of Log-Linear Utility Functions" (with Yves Balasko), Journal of Economic Theory, Vol. 24(1), February 1981, 143-152.

• "On Taxation and Competitive Equilibria" (with Yves Balasko) in Optimalité et Structures: Mélanges en Hommage à Edouard Rossier (G. Ritschard and D. Royer, eds.), Paris: Economica, 1985, 69-83.

• "Lump-Sum Taxes and Transfers: Public Debt in the Overlapping-Generations Model" (with Yves Balasko) in Essays in Honor of Kenneth J. Arrow, Vol. II: Equilibrium Analysis (W. Heller, R. Starr, and D. Starrett, eds.), New York: Cambridge University Press, 1986, Chapter 5, 121-153.

• "Overlapping-Generations Model and Monetary Economics" (with Bruce D. Smith), in the New Palgrave Dictionary of Money and Finance (J. Eatwell, M. Milgate, and P. Newman, eds.), Vol. 3, London: Macmillan, 1992, 104-109.

• "Lump-Sum Taxation: The Static Economy" (with Yves Balasko) in General Equilibrium, Growth, and Trade: The Legacy of Lionel McKenzie, II. (R. Becker, M. Boldrin, R. Jones and W. Thomson, eds.) New York: Academic Press, 1993, 168-180.

• "Price Level Volatility: A Simple Model of Money Taxes and Sunspots" (with Joydeep Bhattacharya and Mark Guzman), Journal of Economic Theory, Vol. 81(2), August 1998, 401-430. (doi:10.1006/jeth.1997.2362) 

• "The Economic Effects of Restrictions on Government Budget Deficits" (with Christian Ghiglino), Journal of Economic Theory, Vol. 94(1), September 2000, 106-137. (doi: 10.1006/jeth.1999.2628)

• "The Economic Effects of Restrictions on Government Budget Deficits: Imperfect Private Credit Markets" (with Christian Ghiglino), Economic Theory, Vol. 21(2-3), March 2003, 399-421. Reprinted in Assets, Beliefs, and Equilibria in Economic Dynamics: Essays in Honor of Mordecai Kurz (C.D. Aliprantis, K.J. Arrow, P.J. Hammond, F. Kubler, H.M. Wu, and N.C. Yannelis, eds.), Berlin: Springer-Verlag, 2004, 213-235. (doi: 10.1007/s00199-002-0288-5)

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