TY  - JOUR
AU  - Green,Jerry
AU  - Kotlikoff,Laurence J.
TI  - On the General Relativity of Fiscal Language
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12344
PY  - 2006
Y2  - June 2006
UR  - http://www.nber.org/papers/w12344
L1  - http://www.nber.org/papers/w12344.pdf
N1  - Author contact info:
Jerry R. Green
Harvard Business School
Baker Library 469
Soldiers Field
Boston, MA 02163
Tel: 617/495-6859
E-Mail: jgreen@hbs.edu

Laurence J. Kotlikoff
Department of Economics
Boston University
270 Bay State Road
Boston, MA 02215
Tel: 617/353-4002
Fax: 617/353-4001
E-Mail: kotlikoff@gmail.com
AB  - A century ago, everyone thought time and distance were well defined physical concepts. But neither proved absolute. Instead, measures/reports of time and distance were found to depend on one%u2019s reference point, specifically one%u2019s direction and speed of travel, making our apparent physical reality, in Einstein%u2019s words, %u201Cmerely an illusion.%u201D
	Like time and distance, standard fiscal measures, including deficits, taxes, and transfer payments, depend on one%u2019s reference point/reporting procedure/language/labels. As such, they too represent numbers in search of concepts that provide the illusion of meaning where none exists.
	This paper, dedicated to our dear friend, David Bradford, provides a general proof that standard and routinely used fiscal measures, including the deficit, taxes, and transfer payments, are economically ill-defined. Instead these measures reflect the arbitrary labeling of underlying fiscal conditions. Analyses based on these and derivative measures, such as disposable income, private assets, and personal saving, represent exercises in linguistics, not economics.
ER  -