The current mantra is that austerity never does work. That the very idea of expansionary austerity is simply wrong.
That is, we should never try to get out of recessionary times by cutting spending – it doesn’t work.
The problem with this is twofold. The original work by Alesina et al never did say what it is said it did. And further, we’ve examples of that expansionary austerity working.
Here from Alesina’s paper:
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This paper summarizes the results of a large recent literature
on multi year Öscal plans for deÖcit reduction (austerity).