Tales of Expansionary Fiscal Contractions in Two European Countries: Hindsight and Foresight

John Considine, David Duffy

Research output: Contribution to journalArticle

Abstract

It is ironic that the potential expansionary effects of fiscal contractions have
become known as non-Keynesian effects. This paper highlights the fact that Keynes and his contemporaries were aware of such potential perverse effects. It is clear that the important indirect effects of budgetary policy via expectation were known in the 1930s. Moreover, the economists of the time recognised the possibilities before they occurred. This paper supplements the existing research on the Expansionary Fiscal Contraction hypothesis by comparing the political and economic environments of two periods in economic history, Britain in 1930-1931 and Ireland 1986-1987, and the accompanying economic thought.
LanguageEnglish
Pages147-167
Number of pages20
JournalJournal of Public Finance and Public Choice
Volume2010
Issue number2/3
Publication statusPublished - 2010

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European countries
Foresight
Expansionary fiscal contraction
Contraction
Indirect effects
Ireland
Economic history
Economists
John Maynard Keynes
Economic thought
Political environment
Economic environment
Fiscal

Cite this

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abstract = "It is ironic that the potential expansionary effects of fiscal contractions havebecome known as non-Keynesian effects. This paper highlights the fact that Keynes and his contemporaries were aware of such potential perverse effects. It is clear that the important indirect effects of budgetary policy via expectation were known in the 1930s. Moreover, the economists of the time recognised the possibilities before they occurred. This paper supplements the existing research on the Expansionary Fiscal Contraction hypothesis by comparing the political and economic environments of two periods in economic history, Britain in 1930-1931 and Ireland 1986-1987, and the accompanying economic thought.",
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Tales of Expansionary Fiscal Contractions in Two European Countries: Hindsight and Foresight. / Considine, John; Duffy, David.

In: Journal of Public Finance and Public Choice, Vol. 2010, No. 2/3, 2010, p. 147-167.

Research output: Contribution to journalArticle

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