what is supply-side economics and what are some of the countries that implemented supply-side economics.?

Question

what are the countries or governments that implemented the supply-side economics and realised great success.

Answer 1

The Wikipedia article on this topic is quite good, read that.

But in short... The term was coined by an economist named Wanninski in the 1970s, and it refers to the idea of maximizing the incentive to produce, trusting that the demand will arise to meet the supply. The key things that the true "supply-siders" advocated for was minimization of taxes and government spending (especially on welfare policies, those are "demand-side"), and a gold standard for currency. The most famous examples of governments that explicitly perused "supply-side" policies are the United States under Regan, and the United Kingdom under Thatcher. But in a broader sense, the neoliberal policies that have been forced onto most of the world by the IMF and other institutions are also a form of supply-side economics.

Few countries have realized success from these kinds of policies for more then a few years at best--thats why supply-side has also come to be known as "voodoo economics". It worked OK for the US, in terms of a narrowly defined goal of economic growth--that doesn't mean people are doing well, and eventually recession set in anyway. Chile sustained growth for a long time through supply-side strategies, but I can't help but add that this was under a brutal military dictatorship that murdered thousands of its own citizens and piled the bodies in the streets. Is that success? I'm not a fan.

Answer 2

The above answers are good but not very satisfying. Here is a much more simple approach:

We have the option of taxing income from 0% to 100%.

If we tax people's incomes at 0%, there is no government revenue -- which means no roads, utilities, judges, or policemen. The country would be chaos, and the economy would fall apart.

Similarly, if we tax people's incomes at 100%, the government would get lots of revenue, but households would not want to work, and firms would not produce due to over-taxation.

The optimal tax rate lies somewhere between 0% and 100%. If the government taxes too little, it does not provide enough public goods, and if it taxes too much it creates incentives for not producing or earning income.

Supply siders thought that the government was taxing too much, and that lowering taxes would stimulate economic growth. There is no convincing economic evidence that they were right.

Answer 3

The US!

Here is the definition from wiki
Supply-side economics often referred to as "Voodoo Economics" is a school of macroeconomic thought which emphasizes the "supply" part of supply and demand. The central concept of supply-side economics is Say's Law: "supply creates its own demand," the idea that one must sell before one can afford to buy. Therefore good economic policy encourages increased production, as opposed to attempting to stimulate demand — this is the fundamental dispute between classical, supply-side economics and Keynesian economics or demand side economics. Supply-side economics is often conflated with trickle-down economics. Supply-side economics was popularised in the 1970s by the ideas of Robert Mundell, Arthur Laffer, and Jude Wanniski. The term was coined by Wanniski in 1975.

In 1978 Jude Wanniski published The Way the World Works in which he laid out the central thesis of supply-side economics and detailed the failure of high tax-rate progressive income tax systems and U.S. monetary policy under Keynesians in the 1970s. Wanninski advocated lower tax rates and a return to some kind of gold standard, ala the 1944-1971 Bretton Woods System.

In 1983, economist Victor Canto, a disciple of Arthur Laffer, published The Foundations of Supply-Side Economics. This theory focuses on the effects of marginal tax rates on the incentive to work and save, which affect the growth of the "supply side" or what Keynesians call potential output. While the latter focus on changes in the rate of supply-side growth in the long run, the "new" supply-siders often promised short-term results.

Answer 4

The above repsonse was concise and to the point. I like how Allen laid out the fundamental question of taxing %0-100.

Allan said: "If we tax people's incomes at 0%, there is no government revenue -- which means no roads, utilities, judges, or policemen. The country would be chaos, and the economy would fall apart."

There is much literature that discusses why this is not the case.
This only proves dependency. We naturally look to judges and policeman as forms of government, but its very easy to explain how roads and utilities are and should be private.

And besides, government does not create economy. So the economy falling apart because there are no taxes is just plain false.

Answer 5

Santa Ba is correct. The U.S. under Ronald Reagan attempted to stimulate an economy thru the supply side and tax reduction was the tool. It is often referred to as voodoo economics, but I think it works! People worry that the budget will go out of whack if we reduce tax rates because they fear not enough tax revenues will flow to the government at lower rates. The more likely result is that more total tax revenues will be generated because we will have more economic activity (expand the economic base) to be taxed. So even though the tax rate is lower, the revenues collected will be higher (see Laffer curve).

Answer 6

every country has supply side policies. the us subsidy on ethanol production is a supply side economic policy as it encourages people to produce ethanol. some think most supply side economic policies are quite bad as typically everything that connects to the supply side of the economy is regulated by the govt. thats why ull often see the concepts deregulation and supply side and microeconomics or microeconomy together.

Answer 7

grant factor economics merely acknowledges that economic advance could be maximum effectively created by making use of reducing obstacles for human beings to offer (grant) products and centers, including reducing income tax and capital helpful aspects tax costs, and by making use of permitting greater desirable flexibility although decreased regulation. Any time you do something to make it greater rewarding for human beings to offer, you're making use of grant factor economics. the main important growth era in historic previous 1983-2007 became greater often than not equipped on those sorts of strikes. of direction, on the instant we are greater often than not doing precisely the different.