③ way of issuing bonds to make up the deficit. That by borrowing, government spending can expand, the establishment and expansion of public investment, to make up for the lack of private consumption to increase employment and economic prosperity purpose. See Keynesian fiscal policy, Keynesian tax ideology. Financial point of view of the School of
supply
② The tax revenue as an important means of regulating social and economic. Keynes argued that the state should change the tax system, to limit interest rates or other means to guide and stimulate consumer demand. The Keynesian also tax and investment linked to the implementation of tax increases or tax cuts, according to the needs of state intervention in the economy, to seek to ease the recession. Hanson advocated the use of accelerated depreciation to encourage enterprises to invest. Mike Connor, the CR believes that the personal income tax, corporate income tax has automatic stabilizing role in regulating the relationship between supply and demand.
1929 outbreak of a world-scale economic crisis, the world economy into a prolonged slump, the unemployment problem is serious, urgent needs of the monopoly capitalist class a "cure" unemployment and crises and to strengthening the rule of monopoly capital theory and policy measures World pipe network reported that the world's steel pipe network to provide the world's steel pipe network editor . Keynes in his "General Theory," a book described the economic thought is to adapt to this need, and caused the shock of the Western economic circles. Many bourgeois economists to abandon the traditional view of vulgar economics, and follow Keynes and the "General Theory" to supplement and development, forming a Keynesian. Its main representative of the United States, AH Hansen, JV Robinson, PA Samuelson, the United Kingdom, P. Sraffa. Their main financial perspectives and the policies and proposals:
monetarist school starting in the 1950s by M. Friedman, professor at the University of Chicago as the main representative of the He stressed that the economic life of personal freedom, freedom of choice of consumers and producers of free competition, and strongly opposed to government intervention in the economy. Advocates start from the compression of fiscal spending to control inflation; oppose the use of tax cuts and expanded government spending and an expansionary fiscal policy to stimulate the economy; Keynesian fiscal, monetary policy advocate instead of a single monetary policy rules.
① the implementation of economic and fiscal policies of state intervention. Keynes proposed the theory of insufficient effective demand that economic crisis is caused by the lack of that is, consumer demand and investment demand due to lack of effective demand. To eliminate the economic crisis, the need to stimulate effective demand. Therefore, the Government must expand fiscal spending, a large number of issuing bonds, the implementation of the budget deficit policy. Hansen put the budget deficit policy and economic cycles linked to that in the Depression, the government should implement a deficit budget policy, to compensate for the insufficient effective demand; during the boom years, the implementation of the budget surplus policy in order to reduce the effective demand. This aims to adjust the effective demand in order to iron out the policy of the capitalist economic fluctuations, known as compensatory fiscal policy.
thesupply-siders is the rise of a bourgeois school of economics in the United States in the 1970s, the emphasis on economic supply that automatically adapts to supply demand changes name. Their representative for AB Laffer, PC Roberts et al. They re-affirmed the Say's Law, attributed stagflation, Keynesian economic policy. The supply-siders to oppose the policy of Keynesian deficit financing, advocates of lower taxes to stimulate economic growth. That must reduce government intervention in economic activities, and greater reliance on market automatic adjustment mechanism of the main measures to cut government spending, especially social welfare spending World pipe network reported that the world's steel pipe network to provide the world's steel pipe network editor , reduce government control of all private sector to see the supply-siders fiscal policy, supply-siders tax ideas .
Thecontemporary western financial theory
financial point of view of the monetary school
Keynesian fiscal point of view