Government Debt in Economic Thought of the Long 19th Century

Freie Universit├Ąt Berlin, School of Business & Economics Discussion Paper No. 2013/4

31 Pages Posted: 17 May 2013

See all articles by Carl-Ludwig Holtfrerich

Carl-Ludwig Holtfrerich

Free University of Berlin (FUB) - John F. Kennedy Institute for North American Studies

Date Written: April 24, 2013

Abstract

The positions of British and German economists on public debt in the long 19th century differed substantially from each other. While British classical economists regarded any public debt as ruinous for the country, German economists promoted debt accumulation for productivity-enhancing public investment and current outlays with benefits for future fiscal years. This paper contrasts the positions of the most prominent British economists before 1850, Adam Smith, David Ricardo, Thomas R. Malthus, and John Stuart Mill, with those of their German colleagues Carl Dietzel, Lorenz v. Stein, and Adolph Wagner after 1855. Due to similar political and economic developments in the last third of the 19th century, young, later famous American economists preferred to pursue their graduate studies in Germany.

Keywords: public finance theory 19th century, public debt, British-German comparison, British classical economists, German public finance theorists pre-1900, influence of German Historical School on U.S. economists, Carl Dietzel, Lorenz v. Stein, Adolph Wagner

JEL Classification: B12, B31, E62, H63

Suggested Citation

Holtfrerich, Carl-Ludwig, Government Debt in Economic Thought of the Long 19th Century (April 24, 2013). Freie Universit├Ąt Berlin, School of Business & Economics Discussion Paper No. 2013/4, Available at SSRN: https://ssrn.com/abstract=2255977

Carl-Ludwig Holtfrerich (Contact Author)

Free University of Berlin (FUB) - John F. Kennedy Institute for North American Studies ( email )

Lansstr. 5 - 9
14 195 Berlin
Germany

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