Personally Prudent but Publicly Profligate: Reagan's Generation and Budget Deficits

Hall, Joshua, Horpedahl, Jeremy, Atlantic Economic Journal

According to economic historian Robert Higgs (Crisis and Leviathan: Critical Episodes in the Growth of American Government, 1987), during the early part of the twentieth century, government spending at all levels (federal, state, and local) rarely exceeded 6 or 7 % of Gross National Product (GNP). Even after rising to 21% of GNP during WWI, the government's share of the economy returned to 8 % by the late 1920s. During the Great Depression, however, government's share of the economy rose to between 14 and 15 % and would never drop below that point again. Public sector economists have wrestled with an explanation for this seemingly permanent increase in this size and scope of government for some time.

Explanations include changes in the composition of the voting …

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Publication information: Article title: Personally Prudent but Publicly Profligate: Reagan's Generation and Budget Deficits. Contributors: Hall, Joshua - Author, Horpedahl, Jeremy - Author. Journal title: Atlantic Economic Journal. Volume: 40. Issue: 3 Publication date: September 2012. Page number: 349+. © 1999 Atlantic Economic Society. COPYRIGHT 2012 Gale Group.

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