It makes no reference to why private infrastructure is allegedly unlikely, let alone impossible, yet you pointed to it to support that notion. Where I come from, that’s called intellectual dishonesty.
Not to my satisfaction. If you want to actually convince me, you’ll have to discuss it more.
I think this first paper by Alm and Rogers doesn’t define “conservative” very well.
It says: "Mofidi and Stone (1990) find that state economic performance depends upon the interrelationship between state taxes and the programs upon which the taxes are spent. They also find that state and local taxes have a negative effect on growth when the revenues are devoted to transfer payments, but that expenditures on health, education, and public infrastructure have positive effects on growth."
It says: “there is strong evidence that a state’s political orientation, as indicated by whether the governor is Republican or Democrat, whether the state has enacted tax and expenditure limitation legislation, and whether the state frequently elects a governor of the same party as the incumbent, have consistent, measurable, and significant effects on economic growth. Perhaps surprisingly, having a Republican governor is associated with lower rates of growth.”
There is the implication that conservatives (read republican governors?) do not favor state government investment in health, education and infrastructure. But has that really been the case?
I cannot find any information from the paper that shows this to be the case. I am also not certain of what, if any, conclusions I am to draw about policy at a federal level.
Also which programs are considered to be “transfer payments?”
The paper concludes: “our estimation results indicate that a state’s fiscal policies have a measurable relationship with per capita income growth, although not always in the expected direction and seldom in a way that is robust to alternative specifications. Tax impacts on state economic growth are quite variable; expenditure impacts are more consistent across different specifications. The statistically significant correlation between state (and state plus local) total 28 tax revenues and economic growth is very sensitive to the regressor set and the time period examined. Often, there are highly significant correlations measured between these variables and per capita income growth, but further work needs to be done before it can be determined what these results mean.”
So I’m not really sure what to make of this paper.
As already noted, I think there are numerous problems with these studies. However, let’s say they come to the correct conclusion; that, under left-wing leadership, economies have tended to grow faster. What’s your point? What are we to draw from this?
I’m concerned you’re trying to draw conclusions about economic theory from something that has *very little (*if anything at all) to do with economic theory.
Just what you’ve said. Make of economic growth what you will.
On infrastructure: the fact that [http://www.fhwa.dot.gov/policy/nadiri2.htmf]public[/url] capital increases private productivity does indicate suboptimal private productivity investment. I don’t intend to be taken literalistically. It’s not a matter of “no private capital has ever existed at all”, but whether or not its level is optimal.
“Optimal” according to whom?
You could use different measures. One could be in the sense that it creates more consumption than it displaces. When public capital creates enough revenue to pay for itself three times over, the point is pretty moot anyway.
In other words, there’s no objective standard for “optimal”, so appealing to the notion of there being one (as you did) is baseless.
I’ve been lurking for a while and finally decided to sign up to the forum. Since I’m terrible at introductions i’ll just jump right in.
In response to the original post, from a psychological stand point the fact that liberal parties have better economic growth isn’t that controversial, conservatives are usually against change. One would think that wanting things to stay the same isn’t the best idea when it comes to economic growth. Just because liberal parties are better for economic growth doesn’t necessarily mean that they are good, or the best, for economic growth however.
As for infrastructure. Regardless of the high cost, the infrastructure would still be built if it were absolutely necessary. Take a bridge for instance. It may cost a large amount of money to build the bridge, so much that a single business may not be able to afford to have it built. Public infrastructure such as a bridge usually benefits more than just a single business though, so it would be in the interest of several businesses to have the bridge built, they can just pool their money together to have it built, if the bridge is actually worth being built that is. I don’t see why people have such a problem understanding something so simple.
I don’t think “defenders of the status quo” quite encapsulates all of conservative thought. Nor is it necessarily unique to conservatism.
Since it seems we’re talking about what is commonly called “fiscal conservatism” I assume we’re mainly describing attitudes towards taxation and government expenditure.
Correct?
I’m just trying to be clear on the language.
True, but there are commonsense ones.
Yes, that’s it. Apparently there’s something about public investment that makes economies grow.
@ bloomj31
It’s true that not all conservatives are “defenders of the status quo”, generally speaking though, conservatives are usually less open to change.
The quotes in the original post fails to properly define conservative and liberal so we can’t fully know what they mean. Assuming for a moment they mean fiscal conservative vs. fiscally liberal, I would say they’re findings are meaningless, high production doesn’t make a economy better off; efficient production does.
“Oh look Bob built 500,000 pen warmers. Dave only built 5,000 cars. Bob must be better off economically, right?!?!”
Well, certain types of public investment in particular if I’m to believe this paper.
Republicans can spend just as much money as Democrats though.
“Common sense” has no place in logical debates about economic policy. If you’re actually trying to masquerade certain political rhetoric as such, that’s a different story.
I wish you a long and happy life. Been a nice chat.
Good riddance.
For the record, appealing to common sense is a logical fallacy.
And just where do you think you’re going? What are you afraid of, exactly?
You could say that, but it really doesn’t click to say public infrastructure is bad when it increases economic growth and everyone’s disposable income.
I will now direct you to post hoc ergo propter hoc.
In other words, there’s no objective standard for “optimal”, so appealing to the notion of there being one (as you did) is baseless.
victory: economics can now no longer be considered a science if this position is taken. And “economic growth” becomes a very quesionable aesthetic phrase