What accounts for the trend decline in real interest rates since the 1980s?

Since peaking in 1983, real interest rates in OECD countries have declined sharply as a trend, with major implications for debt sustainability, asset prices and the cost of capital. Why have real interest rates declined as a trend? Possible explanations are: A decline in (real) potential growth; The presence ex ante of growing excess savings over investment, in both OECD countries and globally; Increasingly large global capital flows into OECD bonds; The decline in inflation if central banks’ behaviour has over - indexed nominal interest rates to inflation; A change in the strategy of central banks, which increasingly aim to boost employment and investment; A growing preference for risk-free bonds over risky assets within wealth; A decline in the supply of bonds due to the growing share held by central banks. Among these seven possible explanations for the decline in real interest rates in OECD countries, four are relevant: The decline in potential growth; The increase in savings relative to investment; The decline in inflation; Central banks’ new behaviour.