One of the founding concepts of Modern Monetary Theory is sectoral balances. And its power lies in its simplicity. Every economy can be broken down into three sectors: The government sector, the private sector (which includes me and you) and the foreign sector. Assuming a balanced budget, then government spending increases our net-wealth. A government deficit is our surplus.
The National (Scotland)
Interesting resource, modernmoneylab's databank. Thanks for sharing.
ReplyDeleteWhat was the interactive, graphical website that allowed you to enter balances for each sector, and it adjusted all the rest? Didn't it have four sectors, rather than three (Government, Private, Foreign)?