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Yes, in the short run. Who holds most of that money? In developing countries it is the elites. So if their holdings lose some value, they'll survive. But govern
by diy123 12y ago
Yes, in the short run. Who holds most of that money? In developing countries it is the elites. So if their holdings lose some value, they'll survive. But government spending puts money in the hands of people who need to work for a living. That will benefit the economy as these people will spend more and create demand. In the long run everyone becomes better off if a country undertakes a vigorous and well-thought out infrastructure program (including scientific infrastructure). Yes, I am a Keynesian.
- ta75757 12y agoI suspect most elites hold little of their portfolio in cash. Sure, if the government taxes/borrows/prints to invest in things that help the economy that can have a positive net effect. I don't think hunting for neutrinos is a terribly great way to stimulate the economy. The best argument, I suspect, is the same as for NASA in the US: the fraction of the budget spent on it is tiny (assuming this is true in India's case).