You are looking at 1 - 10 of 179 items

  • Series: New Thinking in Political Economy series x
Clear All Modify Search
You do not have access to this content

Robust Political Economy

Classical Liberalism and the Future of Public Policy

Mark Pennington

This important book offers a comprehensive defence of classical liberalism against contemporary challenges. It sets out an analytical framework of ‘robust political economy’ that explores the economic and political problems that arise from the phenomena of imperfect knowledge and imperfect incentives.
You do not have access to this content

The Political Economy of Public Debt

Three Centuries of Theory and Evidence

Richard M. Salsman

How have the most influential political economists of the past three centuries theorized about sovereign borrowing and shaped its now widespread use? That important question receives a comprehensive answer in this original work, featuring careful textual analysis and illuminating exhibits of public debt empirics since 1700. Beyond its value as a definitive, authoritative history of thought on public debt, this book rehabilitates and reintroduces a realist perspective into a contemporary debate now heavily dominated by pessimists and optimists alike.
This content is available to you

Richard M. Salsman

Not until the Enlightenment and the financial revolution in the eighteenth century did sovereigns borrow publicly, regularly, and responsibly. Constitutionalism, the rule of law, ethical acceptance of lending, and more respect for sanctity of contract increased creditors’ willingness to lend. Three centuries of data show that public leverage – the ratio of public debt to GDP – was highest at the end of the Napoleonic Wars and World War II. Public leverage since 1980 has increased steadily for many sovereigns, but for most of them leverage is still far below prior peaks. The multi-decade rise in public leverage reflects burgeoning welfare states but also coincides with an anomalous decline in public borrowing costs, due mainly to repressive central bank policies.

You do not have access to this content

Richard M. Salsman

Classical views of public debt are mostly pessimistic: Smith, Hume, Say, Ricardo, Postlethwayt, Jefferson, Mill, Marx, and others believe government borrowing is invariably wasteful, ruinous to prosperity, and even morally unjust. Exceptions include realists like Davenant, Melon, Steuart, Hamilton, McCulloch, and Macaulay, who stress the context of borrowing, distinguish productive versus wasteful spending and argue that certain state services are legitimate, productive and indispensable to prosperity. Public debt optimists (De Pinto, Mortimer, Malthus, and Dietzel) are a minority during this era but influence subsequent Keynesian theory.

You do not have access to this content

Richard M. Salsman

Keynesian views of public debt are mostly optimistic: Keynes, Hansen, Lerner, Musgrave, Samuelson, and Krugman believe government borrowing – including for avowedly unproductive public projects – stimulates output, especially in recessions, by absorbing excess savings and boosting aggregate demand. Exceptions include realists like McCord and Seymour, who endorse cyclical but not chronic deficit spending. Clark and Moulton, although sympathetic to the Keynesian view, are pessimistic about Lerner’s “functional finance.”

You do not have access to this content

Richard M. Salsman

Led by Buchanan and Wagner, public choice theory revives classical school pessimism about public debt in the service of critiquing more radical Keynesian views. The main novelty is its theory of “fiscal illusion” whereby inflationary debt finance displaces tax finance so as to render an otherwise painfully burgeoning welfare state electorally palatable. Precursors of the approach include Mises and Lutz. Although also skeptical of the benefits of vast public spending, Mundell, Laffer, and Barro interpret public debt as innocuous.

You do not have access to this content

Richard M. Salsman

As public leverage in major nations reaches heights not seen since World War II, questions about the sustainably and outer limit of public debt issuance become more relevant and urgent. The extent to which a government might overborrow or default has enormous implications for a nation’s political economy. Pessimists and optimists alike are theoretically incapable of discerning the true incidence, sustainability, or limit of public debt, not to mention the fast-accumulating sums of contingent public liabilities. Public credit – the capacity to borrow – is one of many crucial contexts realists incorporate in a proper analysis of public debt.

You do not have access to this content

Richard M. Salsman

You do not have access to this content

Richard E. Wagner

This book advances a social-theoretic treatment of public finance, which contrasts with the typical treatment of government as an agent of intervention into a market economy. To start, Richard Wagner construes government not as an agent but as a polycentric process of interaction, just as is a market economy. The theory of markets and the theory of public finance are thus construed as complementary components of a broader endeavor of social theorizing, with both seeking to provide insight into the emergence of generally coordinated relationships within society. The author places analytical focus on emergent processes of development rather than on states of equilibrium, and with much of that development set in motion by conflict among people and their plans.
You do not have access to this content

Edited by Emily Chamlee-Wright and Virgil Henry Storr

In 2005 Hurricane Katrina posed an unprecedented set of challenges to formal and informal systems of disaster response and recovery. Informed by the Virginia School of Political Economy, the contributors to this study critically examine the public policy environment that led to both successes and failures in the post-Katrina disaster response and long-term recovery. Building from this perspective, this book lends critical insight into the nature of the social coordination problems disasters present, the potential for public policy to play a positive role, and the inherent limitations policymakers face in overcoming the myriad challenges that are a product of catastrophic disaster.