New study reveals how government spending impacts economic inequality.
The article breaks down how government spending affects the economy in a detailed way. By looking at different types of households, the researchers figured out how changes in government spending impact people's spending habits. They used a model to estimate the size and structure of these effects under different rules. Comparing their results to a simpler model showed how differences between households can change the impact of government spending changes. They also explored how economic inequality can affect the way government spending influences the economy.