#transfer_payments_multiplier
Transfer payments multiplier
In Keynesian economics, the transfer payments multiplier is the multiplier by which aggregate demand will increase when there is an increase in transfer payments. Transfer payments are not in the same theoretical category as government spending on goods and services because such payments are not directly injected into a goods market. Instead, the spendable funds are transferred to a member of the public, who then may spend some or all of them. For this reason, transfer payments are analyzed as negative taxes, and their multiplier is usually considered to be equal in magnitude but opposite in sign from that of taxes.
Fri 26th
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