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approaches: a) by testing its theoretical implications on the stability of national saving and the relationship between fiscal … and private saving is detected. In terms of policy implications, these results would suggest that there is some room for … fiscal policy to exert its countercyclical role in the case of Spain. However, the effectiveness of such a policy might be …
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Government bonds are interest-bearing assets. Increasing public debt increases income, wealth, and consumption demand. The smaller government expenditure is, the larger consumption demand must be in equilibrium, and the larger must be public debt. Conversely, lower public debt implies higher...
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We extend "economic equivalence" results, like the Ricardian equivalence proposition, to the political sphere where policy is chosen sequentially. We derive conditions under which a policy regime (summarizing admissible policy choices in every period) and a state are "politico-economically...
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