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Gerhard Reitschuler and Jesús Crespo Cuaresma
''Ricardian Equivalence Revisited: Evidence from OECD countries''
( 2004, Vol. 5 No.16 )
Using a theoretical model based on dynamic optimizing agents, we test empirically the Ricardian Equivalence Proposition (REP) for 26 OECD countries. The empirical specification allows us to obtain estimates of the structural parameters of the theoretical model and to test directly the hypothesis implied by the REP. We find that the REP cannot be rejected for 10 out of 26 countries, where 9 of these 10 countries are European.
JEL: E2 - Macroeconomics: Consumption, Saving, Production, Employment, and Investment: General (includes Measurement and Data)
E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General
Manuscript Received : Jul 29 2004 Manuscript Accepted : Sep 13 2004

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