Boosting demand isn’t a magic bullet

posted by
September 7, 2011
Adam Smith Institute
by Sam Bowman  
Posted in Commentary

"Overall spending has recovered -- its sluggish recent growth is a symptom, not a cause, of the recession. The attempt to boost aggregate demand fiscally in the United States failed miserably. The Keynesian economist Paul Krugman, who Jenkins approvingly cites, says that this was just because the stimulus was too small. Effectively, Krugman thinks the value of stimulus is unfalsifiable -- even a clear refutation of its effectiveness is just proof that we didn’t do enough of it." (09/07/11)  

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