Creating GDP Growth Supply Side Economics.

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Presentation transcript:

Creating GDP Growth Supply Side Economics

Economists often Disagree Are tax cuts good or bad? Do Large Deficits always raise interest rates? Will taxing “rich” people significantly lower GDP? The answer to most economic questions is: IT DEPENDS!

GDP What creates Economic Growth? INCENTIVES MATTER!!! GDP GDP Classical, Keyensian and Supply Side Economists approach the same economic problems in different ways!

How Innovation Drives Economic Growth U.S.PPF Graph Bloom Energy Harlem Children’s Zone

Supply-Side Policy Goal: use incentives to encourage new business! Basic Belief: Government Incentives Matter Goal: use incentives to encourage new business! shift the aggregate supply curve right when PPF shifts right => AS shifts right The supply-side toolbox consists of: Tax cuts to stimulate work, saving, and investment (I↑) Incentives on education training/research expands capacity to produce

Crash Course Econ Video https://www.youtube.com/watch?v=tZvjh1dxz08 (10 minutes) start at 3 minutes

Movies on Education Reform