katy asked in Social ScienceEconomics · 1 month ago

pros and cons of the multiplier effect?

1 Answer

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  • Oiy
    Lv 4
    1 month ago

    It lacks of disciplines. The bad guys who topple the banks can get the bail-out. But so long that MPC<1, it's a miracle for the fiscal policy. It is not always working that way as Keynes said. The prices and wages are sticky. No one can set it free.

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