Careful with that. It’s an accounting identity, and those have a reputation in economics for being easily misleading. Terms in accounting identities are usually aggregates of other terms with lots of interactions which are nonobvious from the identity.
https://en.wikipedia.org/wiki/Sectoral_balances
It is my understanding that this is broadly correct. It is also my understanding that this is not common knowledge.
Careful with that. It’s an accounting identity, and those have a reputation in economics for being easily misleading. Terms in accounting identities are usually aggregates of other terms with lots of interactions which are nonobvious from the identity.
Yeah, I’ll second the caution to draw any conclusions from this. Especially because this is macroeconomics.
Thanks, that is exactly the article I needed! I knew my question was at least MMT-adjacent, I never made the accounting identity connection though.