Supply-side economics holds that economic growth is best fostered by lowering marginal tax rates, reducing regulation and enabling free trade, so as to expand production and supply rather than by managing aggregate demand. It developed in the 1970s in response to stagflation, associated with Arthur Laffer, Robert Mundell and the journalist Jude Wanniski, whose 1978 book The Way the World Works popularized the approach, and it shaped Reagan-era tax policy in the 1980s.
Facts
Start YearDeveloped across the 1970s in response to stagflation; associated with Arthur Laffer, Robert Mundell and Jude Wanniski, and with Reagan-era tax policy in the 1980s. Core TenetLower marginal tax rates raise the after-tax reward for work, saving and investment, expanding aggregate supply; the Laffer curve holds that this effect can be strong enough that, past some point, cutting tax rates increases rather than decreases total government revenue. 1 Connections
Associated Figures and Events
Laffer served on Reagan's Economic Policy Advisory Board (1981-1989) and is the school's most prominent popularizer through the Laffer Curve.
Source Wikipedia
Additional Source Arthur Laffer (Wikipedia)Arthur Laffer, Role as Reagan Advisor and Supply-Side Economics
Associated With
Source Wikipedia
Additional Source Laffer curve (Wikipedia)Lead section
Held Differently
Why this is disputed. Supply-side economics emerged as an alternative to Keynesian demand management, arguing that expanding aggregate supply through lower marginal tax rates and lighter regulation, not stimulating aggregate demand, is the effective route to growth.
Source Wikipedia
Additional Source Supply-side economics (Wikipedia)Supply-side economics, relation to Keynesian economics
Sources
1. Wikipedia
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Supply-side economics (Wikipedia)
Supply-side economics
Supply-side fiscal policies are designed to increase aggregate supply, as opposed to aggregate demand.
- Debated With: Keynesian Economics, Supply-side economics, relation to Keynesian economics
In Group: Free-Market Schools of the Late Twentieth Century, Lead
Supply-side economics is a macroeconomic theory postulating that economic growth can be most effectively fostered by lowering taxes, decreasing regulation, and allowing free trade.
View the SourceTrickle-down economics (Wikipedia)
Trickle-down economics, HistoryQuote, Trickle-down economics, History
Supply-side is 'trickle-down' theory.
Arthur Laffer (Wikipedia)
Associated Figures and Events: Arthur Laffer, Arthur Laffer, Role as Reagan Advisor and Supply-Side EconomicsQuote, Associated Figures and Events: Arthur Laffer, Arthur Laffer, Role as Reagan Advisor and Supply-Side Economics
a member of President Ronald Reagan's Economic Policy Advisory Board for both of his terms (1981-1989)
Laffer curve (Wikipedia)
Associated With: Laffer Curve, Lead sectionQuote, Associated With: Laffer Curve, Lead section
Drastic cuts to state funding for education and infrastructure followed before the tax cut was repealed in 2017 by a bipartisan super majority in the Kansas legislature. == In U.S. political discourse == Supply-side economics rose in popularity among Republican Party politicians from 1977 onwards.
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