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The Return of Fiscal Policy

Barry Eichengreen, (2019), “The Return of Fiscal Policy”, Project Syndicate, 13 Μαϊου

Public debt is not a free lunch in an economy close to full employment. But when investment demand tends to fall short of saving, as it does when monetary policymakers are unable to push inflation higher to reduce real interest rates, there is a risk of chronic underemployment – and a stronger argument for deficit spending.

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