Supply-Side Economic Model

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A Supply-Side Economic Model is a macroeconomic model which predicts that economic growth can be most effectively created by lowering barriers for people to supply (produce) goods and services.



References

2018

2008

  • http://www.encyclopedia.com/finance/encyclopedias-almanacs-transcripts-and-maps/supply-side-theory
    • QUOTE: Supply side theory is an approach to economics based on the idea that the best way to make the economy grow is to encourage businesses to supply more goods and services for purchase. Supply and demand are the basic forces that shape all economic activity. ...

      ... Supply siders, as those who believe in supply side theory are sometimes called, generally believe that supply creates demand, so they encourage governments to craft policies that will result in increased production. Often this translates into a consistent program of tax cuts, especially cuts in income taxes (the taxes individuals pay on the money they earn each year) and in taxes that affect businesses. The money that individuals and businesses save will, in the view of supply siders, be invested in businesses, which will increase production and cause the economy to grow.