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Tag Archives: multiplier

africa_poverty-383x480146 million more people are falling into poverty, defined now as income of less than $1.25 per day. Like I mentioned here a couple of days ago, yes, the people most vulnerable to a recession are those that are marginally employed.

It is obvious that people with such small incomes are much more likely to spend an extra dollar or two if it was made available. Would it not make good sense to give all the bailout money to the poor? Not only because they need it more, they are much more likely to spend their increased income, increasing the multiplier and encouraging new investment