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Structural deficit: Wikis

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Structural deficit forms part of the public sector deficit. Structural deficit differs from cyclical deficit in that it exists even when the economy is at its potential.

Structural deficit issues can only be addressed by explicit and direct government policies: reducing spending (including entitlements), increasing the tax base, and/or increasing tax rates. It can be described as more "chronic" or long-term in nature hence needing government action to remove it.

The opposite of a structural deficit is a structural surplus. Likewise, the opposite of a cyclical deficit is a cyclical surplus.

See also


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