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This working paper examines the limitations of government borrowing and seeks to empirically distinguish between two views on whether governments can maintain permanent budget deficits. The authors argue that the credibility of government debt relies on the expectation that budgets must eventually balance in present-value terms, which has significant implications for macroeconomic theory and policy.
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Obtain a copy of the NBER Working Paper template from the official NBER website.
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The NBER Working Paper No is a unique identifier assigned to research papers published by the National Bureau of Economic Research (NBER).
Researchers and economists who publish their work through the NBER are required to file their working papers with an assigned NBER Working Paper No.
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Information that must be reported includes the working paper's title, authors, publication date, and the assigned NBER Working Paper No.
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