What is a critical assumption for the strict application of the Ricardian Equivalence theorem?

💡 Explanation:

The Ricardian Equivalence theorem, which posits that debt-financed tax cuts do not affect aggregate demand, relies on several strong assumptions. The most technically demanding and frequently debated is the assumption that current generations are linked to future generations (who will pay the debt) by 'operative' bequests, ensuring they fully account for the future tax burden in their present saving decisions.