Most macroeconomists believe it is a good thing that taxes act as automatic stabilizers and lower the

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Most macroeconomists believe it is a good thing that taxes act as automatic stabilizers and lower the size of the multiplier. However, a smaller multiplier means that the change in government purchases of goods and services, government transfers, or taxes needed to close an inflationary or recessionary gap is larger. How can you explain this apparent inconsistency?

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Essentials Of Economics

ISBN: 9781429278508

3rd Edition

Authors: Paul Krugman, Robin Wells, Kathryn Graddy

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