Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/54325
Authors: 
Wray, L. Randall
Papadimitriou, Dimitri B.
Year of Publication: 
2003
Series/Report no.: 
Public policy brief // Jerome Levy Economics Institute of Bard College 74
Abstract: 
Most recent discussions of deflation seem to overlook the main dangers posed by a deflationary economy and appear to offer superficial solutions. In this brief, the authors argue that, barring drastic changes in asset and output prices, deflation itself is not the main problem, but rather the recessionary conditions that sometimes give rise to deflation. Whether or not prices are falling, the proper remedy for a recession is the Keynesian one: government deficit spending, used to finance useful programs and tax cuts. These measures will reduce unemployment, increase growth, and relieve deflationary pressures.
ISBN: 
1931493243
Document Type: 
Research Report

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