Governments must consider intertemporal budget constraints from "summary" of Public Finance by Harvey S. Rosen
The concept of intertemporal budget constraints is crucial for governments to consider when making fiscal decisions. This concept emphasizes the importance of looking beyond the current budget period and taking into account the long-term implications of current policy choices. When governments fail to consider intertemporal budget constraints, they risk creating unsustainable fiscal policies that could lead to budget deficits, rising debt levels, and ultimately, economic instability. By understanding the interplay between current and future budget constraints, governments can make more informed decisions that promote fiscal sustainability and long-term economic growth. Intertemporal budget constraints highlight the ...
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