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Fiscal Policy/Neoclassical theories: many neo-classical economists (...) reject all forms of economic control through fiscal policy. The reason is that according to neoclassical theory, rational households expect tax increases in the future as government deficits rise.
Def Ricardian equivalence: rational households are taking the expectation of rising taxes as an opportunity to reduce their consumption already today. NeoclassicismVsKeynesianism: See Government Debt/Keynesianism._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. The note [Author1]Vs[Author2] or [Author]Vs[term] is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.
Politik und Wirtschaft: Ein integratives Kompendium Wiesbaden 2018