BALANCED-BUDGET MULTIPLIER: The ratio of the change in aggregate output (GDP) to a change in government spending, which are matched by an equal change in taxes. This is termed a balanced-budget multiplier because the change in spending is matched by the change in taxes and thus the government's budget deficit or surplus is neither increased nor decreased. If the government had a balanced budget before the changes, then it has one after the changes.

     See also | aggregate output | gross domestic product | government | taxes | multiplier | budget deficit | budget surplus | government purchases | transfer payments | household sector | government sector | consumption | disposable income |

BALANCED-BUDGET MULTIPLIER, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2021. [Accessed: June 17, 2021].

Additional information on this term can be found at:

WEB*pedia: balanced-budget multiplier

Back to the GLOSS*arama

A change in aggregate expenditures on real production, especially those made by the household and business sectors, that results because a change in the price level alters the interest rate which then affects the cost of borrowing. This is one of three effects underlying the negative slope of the aggregate demand curve associated with a movement along the aggregate demand curve and a change in aggregate expenditures. The other two are real-balance effect and net-export effect.

Complete Entry | Visit the WEB*pedia

Today, you are likely to spend a great deal of time browsing about a thrift store hoping to buy either a package of 3 by 5 index cards, the ones without lines or a blue mechanical pencil. Be on the lookout for spoiled cheese hiding under your bed hatching conspiracies against humanity.
Your Complete Scope

This isn't me! What am I?

-- Mark Twain, writer

User Feedback