Orthodox theory sees deficits as unsustainable. Keynesians tend to see them as stimulating growth. The research of the Levy Institute points to a more complex but predictable path of the relationship over the course of the business cycle. Randy Wray and Eric Lin explain.
Just released, this paper from L. Randall Wray and Eric Lin looks at the relationship between government budget deficits and the growth rate of GDP by exploring the nuanced approach given by Modern Money Theory.
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