On the Non-Divergence Condition of the Debt-GDP Ratio Considering Consumption from Assets and Impossibility of Fiscal Collapse with Arguments about Important Misconceptions in Macroeconomics

Tanaka, Yasuhito (2025): On the Non-Divergence Condition of the Debt-GDP Ratio Considering Consumption from Assets and Impossibility of Fiscal Collapse with Arguments about Important Misconceptions in Macroeconomics. Published in: Financial Economics Letters , Vol. 4, No. 1 (30 September 2025): pp. 37-47.

Abstract

This short note presents a non-divergence condition of the debt-GDP ratio considering consumption from assets, and shows that fiscal collapse is impossible. Also in the supplement (Appendix 3) I present arguments on important misconceptions in macroeconomics about relationship between investment and savings. I will show that investment entities and savings entities are identical and that investment and savings are the same acts.

• Item Type: MPRA Paper
• Language: English
• Keywords: non-divergence condition of the debt-GDP ratio; impossibility of fiscal collapse; consumption from assets; misconceptions in macroeconomics
• Subjects: E - Macroeconomics and Monetary Economics > E0 - General > E00 - General

References

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