postmodernism and neoclassical economics

Doug Henwood dhenwood at
Wed Feb 3 06:39:23 PST 1999

Michael Yates wrote:

>Actually, though, doesn't supply-side economics go back to the arguments
>of J.B. Say?

Sure, but the Laugher Curve, which claimed that lower tax rates would result in higher collections (and vice versa), is what I had in mind. And its ideological corollary, that the U.S. economy fell ill in the 1970s because rich people were overtaxed. Loyal supply-siders are adamant that the 1980s boom was caused by a rejiggering of incentives, through lower taxes on capital and high-end labor, and not by the Keynesian demand stimulus of deficits. At the low end, taxes were increased and wages and benefits cut for the poor, on the theory that the rich need the incentive of higher incomes, and the nonrich of lower incomes, to inspire them to higher levels of productivity.

>And is not the labor conomics notion that educating
>workers, training them, etc. will get them jobs and higher wages a
>supply-side notion too?

That's the liberal variant of supply-side economics: train them and the jobs will come.


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