Tôi vẫn còn ở giai đoạn mà tôi không biết câu trả lời là. MD: Đó chắc chắn là một thách thức trí tuệ rõ ràng cho tương lai. Cass: Vâng, nó là một câu đố trí tuệ. Và tôi phải thừa nhận rằng trong sự nghiệp của tôi trong kinh tế học tôi đã | 100 William A. Barnett and Robert Solow Modigliani It creates noise so therefore whatever government does is bad. Wage rigidity to me is a perfect example contradicting the above conclusion. Nor can you dispose of wage rigidity with the hypothesis of staggered contract. If that contract is rational then wages are rigid and one better take this into account in theory and policy or the staggered contract is not rational and in a Chicago world it should have long ago disappeared. Barnett Robert Barro who I understood was a student in some of your classes advocates a version of Ricardian equivalence that appears to be analogous in governmental finance to the Modigliani-Miller theorem in corporate finance and in some ways to your life-cycle theory of savings with bequests. In fact he sometimes speaks of one of your classes at MIT that he attended in 1969 as being relevant to his views. But I understand that you do not agree with Barro s views of government finance. Why is that Modigliani Barro s Ricardian equivalence theorem has nothing in common with the Modigliani-Miller proposition except the trivial relation that something doesn t matter. In the Modigliani-Miller theorem it is capital structure and in the Barro theorem it is government deficit. In my view Barro s theorem despite its elegance has no substance. I don t understand why so many seem to be persuaded by a proposition whose proof rests on the incredible assumption that everybody cares about his heirs as if they were himself. If you drop that assumption there is no proof based on rational behavior and the theorem is untenable. But that kind of behavior is very rare and can t be universal. Just ask yourself what would happen with two families when one family has no children and another family has 10. Under Ricardian equivalence both families would be indifferent between using taxes or deficit financing. But it is obvious that the no-children family would prefer the deficit and the other would presumably .
