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A Keynesian Defense of the Reagan Deficit

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  • Richard J. Cebula

Abstract

. The argument of Professor R. J. Alexander that the Reagan deficit had little impact upon interest rates is attacked on the basis of a lack of empirical analysis and its reliance upon the non‐market prime rate of interest. Procedures used follow Hoelscher, Barth, Iden, Russek, and others and relate to the expected inflation rate.

Suggested Citation

  • Richard J. Cebula, 1990. "A Keynesian Defense of the Reagan Deficit," American Journal of Economics and Sociology, Wiley Blackwell, vol. 49(1), pages 47-52, January.
    • Handle: RePEc:bla:ajecsc:v:49:y:1990:i:1:p:47-52
    DOI: 10.1111/j.1536-7150.1990.tb02259.x
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    References listed on IDEAS

    as
    1. Evans, Paul, 1985. "Do Large Deficits Produce High Interest Rates?," American Economic Review, American Economic Association, vol. 75(1), pages 68-87, March.
    2. Hoelscher, Gregory, 1986. "New Evidence on Deficits and Interest Rates," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 18(1), pages 1-17, February.
    3. Feldstein, Martin S & Eckstein, Otto, 1970. "The Fundamental Determinants of the Interest Rate," The Review of Economics and Statistics, MIT Press, vol. 52(4), pages 363-375, November.
    4. Makin, John H, 1983. "Real Interest, Money Surprises, Anticipated Inflation and Fiscal Deficits," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 374-384, August.
    5. Evans, Paul, 1987. "Interest Rates and Expected Future Budget Deficits in the United States," Journal of Political Economy, University of Chicago Press, vol. 95(1), pages 34-58, February.
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