Supply-Side Economics


For a Free Scotland
Do you agree with the tenets of supply side economics? Do you believe that the state should follow such a philosophy?

For the uninformed, supply-side economics is the belief that growth is stimulated by providing incentives to produce goods. The most obvious example of such a policy are tax cuts, both personal and business for the wealthy, the main good-producing class in society. This theory is usually packaged with 'trickle-down economics' which is that policies that favor the wealthy will eventually have positive ramifications on the lower classes.


Registered Member
Although I had two classes on political economy, I know too few about economy to have a final opinion on it. In the end, I would say it's an empirical question whether supply- or demand-side policies are more effective.

When left-leaning people attack supply-side economics, they will often say things like "cars don't buy cars", suggesting that the real trick to stimulate economy is providing the consumers with more money to buy products, instead of stimulating production.

From what I've gathered, demand-side policies used to be rather popular, due to Keynesianism, from the late 1940s to the 1970s. But in the 70s, the limits of demand-side policies became obvious and thus supply-side policies were en vogue once again. Still most governments occasionally still use Keynesianist concepts to varying degrees.

That's really all I can say about this topic, I don't know much more about it.


still nobody's bitch
In theory, supply-side economics seems viable. More people buying more goods means more people being paid to make those goods. However the reality is not so simple. As it turns out, rampant consumerism isn't all that good for the environment.

Globalism and international trade policies also impact the effectiveness of supply-side economics. National and multinational corporations are unfortunately responsible first to shareholders, then to the welfare of their employees. If it's more profitable to manufacture goods in another country, then only the shareholders and upper-level management benefit.