Explain whether or not you agree with the premise of the Ricardian equivalence theory that rational people
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Explain whether or not you agree with the premise of the Ricardian equivalence theory that rational people might reason: “Well, a higher budget deficit (surplus) means that I’m just going to owe more (less) taxes in the future to pay off all that government borrowing, so I’ll start saving (spending) now.” Why or why not?
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The Ricardian equivalence theory proposed by economist David Ricardo suggests that individuals are forwardlooking and rational in their economic decis...View the full answer
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