Last edited Sun Jan 22, 2012, 05:58 AM - Edit history (1)
I know there are classes where it is not discussed, (such as those by Greg Mankiw, perhaps?), but it would seem foundational for a well-rounded perspective.
In any event, this paper from Professor Randall Wray at Univ of Missouri - Kansas City discusses this...
From the paper: "Budget deficits represent private sector savings. Or another way of putting it: every time the government runs a deficit and issues a bond, adding to the financial wealth of the private sector. (Technically, the sum of the private sector surpluses equal the sum of the government sector deficits, which equals the outstanding government debt—so long as the foreign sector is balanced.)"
and there are some formulae that might be applicable at http://pragcap.com/resources/understanding-modern-monetary-system , near the end. Haven't ever tried to email Cullen, but it's worth a shot, I suspect. People love to talk about their writing.
Dr. Wray is very interested in helping others learn about this, and I am sure he would be glad to answer any questions - he answered mine, great resource. Might take a few days, but I bet he would be delighted to get an email about his writing.
wrayr@umkc.edu
I hope that helps.
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