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Rearmament to the rescue? New estimates of the impact of ‘Keynesian’ policies in 1930s’ Britain
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Crafts, N. F. R. and Mills , Terence C. (2012) Rearmament to the rescue? New estimates of the impact of ‘Keynesian’ policies in 1930s’ Britain. Working Paper. Coventry, UK: Department of Economics, University of Warwick. CAGE Online Working Paper Series, Volume 2012 (Number 103).
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Text (Working paper)
WRAP_103.2012_crafts.pdf - Published Version Download (1075Kb) | Preview |
Official URL: http://www2.warwick.ac.uk/fac/soc/economics/resear...
Abstract
We report estimates of the fiscal multiplier for interwar Britain based on quarterly data, time-series
econometrics, and ‘defense news’. We find that the government expenditure multiplier was in the
range 0.5 to 0.8, much lower than previous estimates. The scope for a Keynesian solution to
recession was much lower than is generally supposed. We do find that rearmament gave a
substantial boost to real GDP after 1935 but this was because the private sector responded to news
of massive future defense spending and does not imply that the multiplier effect of temporary public
works programs would have been large.
Item Type: | Working or Discussion Paper (Working Paper) | ||||
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Subjects: | D History General and Old World > DA Great Britain H Social Sciences > HC Economic History and Conditions |
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Divisions: | Faculty of Social Sciences > Economics | ||||
Library of Congress Subject Headings (LCSH): | Great Britain -- Economic conditions -- 20th century, Keynesian economics, Rearmament, Public works -- Great Britain | ||||
Series Name: | CAGE Online Working Paper Series | ||||
Publisher: | Department of Economics, University of Warwick | ||||
Place of Publication: | Coventry, UK | ||||
Official Date: | October 2012 | ||||
Dates: |
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Volume: | Volume 2012 | ||||
Number: | Number 103 | ||||
Number of Pages: | 25 | ||||
Institution: | University of Warwick | ||||
Status: | Not Peer Reviewed | ||||
Publication Status: | Published | ||||
Access rights to Published version: | Open Access (Creative Commons) | ||||
Date of first compliant deposit: | 1 August 2016 | ||||
Date of first compliant Open Access: | 1 August 2016 | ||||
Version or Related Resource: | Crafts, N., Mills, T. C. (2013) Rearmament to the rescue? New estimates of the impact of ‘Keynesian’ policies in 1930s’ Britain. Coventry, UK : University of Warwick, 2013, pp. [1-41]. (Warwick economics research papers series, no. 1018). http://wrap.warwick.ac.uk/id/eprint/56606 | ||||
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