Director / Editor: Victor Teboul, Ph.D.

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NZ Budget 2024: tax cuts and borrowing don’t always fuel inflation – but Nicola Willis has to get the balance right

By Dennis Wesselbaum, Associate Professor, Department of Economics, University of Otago

Spikes in inflation are often blamed on government borrowing to deliver cash handouts. But it’s more complicated than that. The real issue lies in borrowing without a plan to balance the books.

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