An experimental analysis of two departures from Ricardian equivalence

Roberto Ricciuti () and Davide Di Laurea ()

Economics Bulletin, 2003, vol. 8, issue 11, pages 1-11

Abstract: We construct an overlapping-generations experiment to test for two alleged departures from Ricardian equivalence. In the first treatment the setting is close to the theoretical model, while in the second we allow for liquidity-constrained consumers. We then introduce uncertainty on future income for the first generation. Ricardian equivalence is well supported in the baseline experiment and to some extent in the liquidity-constraint case, whereas it is clearly rejected under uncertainty.

Keywords: experiments; liquidity constraints.; overlapping generations; Ricardian equivalence; uncertainty (search for similar items in EconPapers)
JEL-codes: H3 C9 (search for similar items in EconPapers)
Date: 2003-09-23
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