Policy Makers’ Debt Fears Can Worsen Downturns, Say Researchers

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Policy Makers’ Debt Fears Can Worsen Downturns, Say Researchers
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A new economic study aims to explain why countries with low debt-to-GDP ratios tend to fare better after financial crises

Academic research has shown that countries with higher levels of government debt relative to the size of their economies fare worse after financial crises than countries with lower debt levels.The paper from Christina and David Romer, economists at the University of California at Berkeley,.

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