Argh. An anticapatory spending response requires full & efficient financial markets (i.e. loans at reasonable rates). The fact that there *is* a response reveals that that assumption is not valid for low income individuals.

Done.

Understand the assumptions behind the theory. https://twitter.com/adam_tooze/status/1294642501207244802

BTW, complete & identical financial markets are one of the big assumptions behind Ricardian equivalence (RE).
Agents & governments have different interest rates on savings/loans? Agents can't borrow the amount of the stimulus? RE assumptions aren't satisfied, result may not hold.

This is not a failure of theory. This is a failure of people to *understand* the theory and apply it appropriately to situations. Theory let's you take shortcuts and make simplicitions, but if your lazy about it you will be led astray.

I'm 100% still annoyed at Ph.D. economists who were using Ricardian Equivalence to argue against the fiscal stimulus.

Either your income level, or your complete failure to understand basic dynamic macro models (or both) is showing.

This is a great thread that brings in the current state of research: https://twitter.com/glviolante/status/1294710715048169478?s=20