Deficits and Institutional Theorizing about Households and the State

  title={Deficits and Institutional Theorizing about Households and the State},
  author={Zdravka K. Todorova},
In a pecuniary economy, households’ spending is limited by the stock of state money and the flow of income received in the form of state money. Thus, households are subject to liquidity constraint as they incur debts in the established unit of account, and consequently need to obtain the widely accepted medium of exchange (Wray 1998; Bell 2001). Even when households’ borrowing is unlimited, there is liquidity constraint to the extent that various interest rates and fees are administered by… CONTINUE READING


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