The Economic Policy of Ronald Reagan: Between Supply-Side and Keynesianism

Magazzino, C., (2012), The Economic Policy of Ronald Reagan: Between Supply-Side and Keynesianism, European Journal of Social Sciences, 27, 3, 319-334

16 Pages Posted: 30 Sep 2013

See all articles by Cosimo Magazzino

Cosimo Magazzino

University of Rome III; Royal Economic Society; Italian Economic Association

Date Written: 2012

Abstract

“Reaganomics” is a popular term used to refer to the economic policies of Ronald W. Reagan, the 40th U.S. President (1981-1989), which called for widespread tax cuts, decreased social spending, increased military spending, and the deregulation of domestic markets. In this paper, we analyze American economic policy during the Eighties. After a brief introduction, where a general economic context of that country is shown, we discuss and revise the economic literature about these issues. Afterwards, we present an augmented IS-LM model for Reagan years, estimated by VECM techniques, discussing the major econometric findings. Finally, we suggest some concluding remarks.

Keywords: Reaganomics, Supply-Side Economics, Laffer curve, tax cuts, twin deficits, augmented IS-LM model, VECM

JEL Classification: A1, C22, H1, N42

Suggested Citation

Magazzino, Cosimo, The Economic Policy of Ronald Reagan: Between Supply-Side and Keynesianism (2012). Magazzino, C., (2012), The Economic Policy of Ronald Reagan: Between Supply-Side and Keynesianism, European Journal of Social Sciences, 27, 3, 319-334, Available at SSRN: https://ssrn.com/abstract=2333397

Cosimo Magazzino (Contact Author)

University of Rome III ( email )

Via Ostiense 139
Rome, RM 00154
Italy

HOME PAGE: http://scienzepolitiche.uniroma3.it/cmagazzino/

Royal Economic Society ( email )

London
United Kingdom

Italian Economic Association ( email )

Piazzale Martelli, 8
Ancona, AN 60121
Italy

HOME PAGE: http://www.siecon.org/online/en/

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