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“Austerian” economics: Does the Vienna school favor fiscal deficit reduction even in a subpar economy?

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  • Lawrence White

Abstract

Does the economic analysis associated with the modern Austrian school favor a policy of restraining the government’s fiscal deficit even in a subpar economy, as suggested by those who (pejoratively) label such a policy “austerian”? Because resources are not superabundant even in a subpar economy, the answer is yes, unless (implausibly) the return on the last (lowest-payoff) dollar of government expenditure exceeds the return on private investment. Copyright Springer Science+Business Media New York 2014

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  • Lawrence White, 2014. "“Austerian” economics: Does the Vienna school favor fiscal deficit reduction even in a subpar economy?," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 27(4), pages 351-358, December.
    • Handle: RePEc:kap:revaec:v:27:y:2014:i:4:p:351-358
    DOI: 10.1007/s11138-014-0278-4
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    References listed on IDEAS

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    1. Barro, Robert J, 1974. "Are Government Bonds Net Wealth?," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1095-1117, Nov.-Dec..
    2. White,Lawrence H., 2012. "The Clash of Economic Ideas," Cambridge Books, Cambridge University Press, number 9781107012424.
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    Cited by:

    1. Mark Pennington, 2021. "Hayek on complexity, uncertainty and pandemic response," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 34(2), pages 203-220, June.

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    More about this item

    Keywords

    Austerian; Austerity; Austrian; Fiscal deficit; Free lunch; Hayek; Keynes; Mises; Multiplier; Ricardian equivalence; JEL codes; B2; E3; E6; H6;
    All these keywords.

    JEL classification:

    • B2 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • H6 - Public Economics - - National Budget, Deficit, and Debt
    • I - Health, Education, and Welfare

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