The experience of the 1980s:

Question

Quizplus · Accepted Answer

The experience of the 1980s can be used to argue both in favor of and against the Ricardian equivalence view of tax cuts, depending on how it is analyzed and interpreted. Some may argue that the low levels of national saving during this period contradict the Ricardian equivalence view, while others may argue that people saved less because they were optimistic about the economy, as evidenced by the stock market boom. Ultimately, it is difficult to draw a clear conclusion about the validity of Ricardian equivalence based solely on the experience of the 1980s.

The Experience of the 1980s