assume that the maximum revenue that can be collected from all taxes, including seniorage, is 5000 goods and that the maximum debt is 6000. The real gross market rate of return is 1.2. Government expenditures currently equal 4500 goods. How can government leaders use their control over current taxes, subsidies, and the government debt to force their successors to reduce steady-state government expenditures below 4500 goods?

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01-12-2022
Business

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assume that the maximum revenue that can be collected from all taxes, including seniorage, is 5000 goods and that the maximum debt is 6000. The real gross market rate of return is 1.2. Government expenditures currently equal 4500 goods. How can government leaders use their control over current taxes, subsidies, and the government debt to force their successors to reduce steady-state government expenditures below 4500 goods?

Sagot :

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