Economics is a social science that studies the production, distribution, and consumption of goods and services.
Keynesian economics are the various macroeconomic theories and models of how aggregate demand strongly influences economic output and inflation. In the Keynesian view, aggregate demand does not necessarily equal the productive capacity of the economy. It is influenced by a host of factors that sometimes behave erratically and impact production, employment, and inflation.
James McGill Buchanan Jr. was an American economist known for his work on public choice theory originally outlined in his most famous work, The Calculus of Consent, co-authored with Gordon Tullock in 1962. He continued to develop the theory, eventually receiving the Nobel Memorial Prize in Economic Sciences in 1986. Buchanan's work initiated research on how politicians' and bureaucrats' self-interest, utility maximization, and other non-wealth-maximizing considerations affect their decision-making. He was a member of the Board of Advisors of The Independent Institute as well as of the Institute of Economic Affairs, a member of the Mont Pelerin Society (MPS) and MPS president from 1984 to 1986, a Distinguished Senior Fellow of the Cato Institute, and professor at George Mason University.
In economics and political science, fiscal policy is the use of government revenue collection and expenditure to influence a country's economy. The use of government revenue expenditures to influence macroeconomic variables developed in reaction to the Great Depression of the 1930s, when the previous laissez-faire approach to economic management became unworkable. Fiscal policy is based on the theories of the British economist John Maynard Keynes, whose Keynesian economics theorised that government changes in the levels of taxation and government spending influence aggregate demand and the level of economic activity. Fiscal and monetary policy are the key strategies used by a country's government and central bank to advance its economic objectives. The combination of these policies enables these authorities to target inflation and to increase employment. In modern economies, inflation is conventionally considered "healthy" in the range of 2%–3%. Additionally, it is designed to try to keep GDP growth at 2%–3% percent and the unemployment rate near the natural unemployment rate of 4%–5%. This implies that fiscal policy is used to stabilise the economy over the course of the business cycle.
The Ricardian equivalence proposition is an economic hypothesis holding that consumers are forward-looking and so internalize the government's budget constraint when making their consumption decisions. This leads to the result that, for a given pattern of government spending, the method of financing such spending does not affect agents' consumption decisions, and thus, it does not change aggregate demand.
Public finance is the study of the role of the government in the economy. It is the branch of economics that assesses the government revenue and government expenditure of the public authorities and the adjustment of one or the other to achieve desirable effects and avoid undesirable ones. The purview of public finance is considered to be threefold, consisting of governmental effects on:
- The efficient allocation of available resources;
- The distribution of income among citizens; and
- The stability of the economy.
"Starve the beast" is a political strategy employed by American conservatives to limit government spending by cutting taxes, to deprive the federal government of revenue in a deliberate effort to force it to reduce spending. The term "the beast", in this context, refers to the United States federal government and the programs it funds, using mainly American tax money, particularly social programs such as education, welfare, Social Security, Medicare, and Medicaid.
Alvin Harvey Hansen was an American economist who taught at the University of Minnesota and was later a chair professor of economics at Harvard University. Often referred to as "the American Keynes", he was a widely read popular author on economic issues, and an influential advisor to the government on economic policy. Hansen helped create the Council of Economic Advisors and the Social Security system. He is best remembered today for introducing Keynesian economics in the United States in the 1930s and 40s.
Richard Abel Musgrave was an American economist of German heritage. His most cited work is The Theory of Public Finance (1959), described as "the first English-language treatise in the field," and "a major contribution to public finance thought."
In public choice theory, fiscal illusion is a failure to accurately perceive the amount of government expenditure. The theory of fiscal illusion was first developed by the Italian economist Amilcare Puviani in his 1903 book Teoria della illusione finanziaria. Fiscal illusion occurs when government revenues are not completely transparent or are not fully perceived by taxpayers; then the cost of government is seen to be less than it actually is. Since some or all taxpayers benefit from government expenditures from these unobserved or hidden revenues, the public's appetite for government expenditures increases, thus providing politicians incentive to expand the size of government.
Georgios Alogoskoufis is a professor of economics at the Athens University of Economics and Business since 1990. He was a member of the Hellenic Parliament from September 1996 till October 2009 and served as Greece's Minister of Economy and Finance from March 2004 till January 2009.
Robert D. Tollison was an American economist who specialized in public choice theory.
Mihir Rakshit is an Indian economist, known for his work on fiscal, monetary and other policy, especially issues that concern developing economies. Originally from Chittagong, which is now in Bangladesh, he did his graduation from Presidency College, Calcutta, post-graduation from the University of Calcutta and his PhD from London School of Economics. He taught at the departments of Economics of The University of Calcutta, The University of Burdwan, Presidency College Calcutta, and Indian Statistical Institute Calcutta, as faculty. He also taught at Delhi School of Economics and Erasmus University Rotterdam, as visiting faculty. He served the Reserve Bank of India for two terms as a member of its Central Board of Directors. He was director of the open access quarterly journal Money and Finance published by ICRA Limited from 1997 to July 2016.
Gordon L. Brady is an American Economist, Professor and Writer and resides in Vienna, Virginia.
Public economics(or economics of the public sector) is the study of government policy through the lens of economic efficiency and equity. Public economics builds on the theory of welfare economics and is ultimately used as a tool to improve social welfare. Welfare can be defined in terms of well-being, prosperity, and overall state of being.
Following the global 2007–2008 financial crisis, there was a worldwide resurgence of interest in Keynesian economics among prominent economists and policy makers. This included discussions and implementation of economic policies in accordance with the recommendations made by John Maynard Keynes in response to the Great Depression of the 1930s, most especially fiscal stimulus and expansionary monetary policy.
Duncan K. Foley is an American economist. He is the Leo Model Professor of Economics at the New School for Social Research and an External Professor at the Santa Fe Institute. Previously, he was Associate Professor of Economics at MIT and Stanford, and Professor of Economics at Columbia University. He has held visiting professorships at Woodrow Wilson School at Princeton University, UC Berkeley, and Dartmouth College, as well as the New School for Social Research.
Giancarlo Corsetti, is an Italian macroeconomist and Professor of Macroeconomics at the European University Institute in Florence. He is best known in academia for his work on open economy macroeconomics and international economics. In March 2017, the IDEAS/RePEc overall ranking put him as the most influential economist at Cambridge University where he was teaching at the time.
William Franklin Shughart II is an American economist who is the J. Fish Smith Professor in Public Choice at the Jon M. Huntsman School of Business at Utah State University. He is research director and senior fellow at The Independent Institute. He is the editor-in-chief of Public Choice, senior associate editor of the Southern Economic Journal and associate editor of the Independent Review.
Democracy in Deficit: The Political Legacy of Lord Keynes is a book by American economists James M. Buchanan and Richard E. Wagner originally published in 1977.
