David Ricardo on Public Debt

197 Pages·2001·0.864 MB·English

by  Nancy Churchman (auth.)

David Ricardo on Public Debt
Studies in the History of Economics
General Editor: D. E. Moggridge
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University;D. E. Moggridge, University of Toronto; B. Sandelin, University of
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Pennsylvania; J. K. Whitaker, University of Virginia; D. Winch, University of
Sussex
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David Ricardo
on Public Debt
Nancy Churchman
© Nancy Churchman 2001
Softcover reprint of the hardcover 1st edition 2001 978-0-333-92148-7
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Library of Congress Cataloging-in-Publication Data
Churchman,Nancy,1965–
David Ricardo on public debt / Nancy Churchman.
p.cm.— (Studies in the history of economics)
Includes bibliographical references and index.
1.Debts,Public—Great Britain.2.Ricardo,David,1772–1823.
3.Capital levy—Great Britain.4.Economics.I.Title.II.Series.
HJ8627 .C48 2001
336.3—dc21
2001021194
10 9 8 7 6 5 4 3 2 1
10 09 08 07 06 05 04 03 02 01
for my parents
Anne and Ken Churchman
with love
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Contents
List of Tables xi
Acknowledgements xiii
1 Introduction 1
1.1 Introduction 1
1.2 Ricardo’s allocation theory 2
1.3 Ricardo’s growth theory 7
1.4 Ricardo’s method 10
1.5 The source of differing interpretations 12
1.6 Plan of work 17
2 Public Debt and the Economics of David Ricardo 21
2.1 Introduction 21
2.2 Public debt and resource allocation 22
2.3 Public debt and economic growth 32
2.4 Optimal taxation 43
2.5 Conclusion 46
3 Public Debt Policy and Public Extravagance: the
Ricardo–Malthus Debate 49
3.1 Introduction 49
3.2 Ricardo, politics and government 51
3.3 The debate over the effects of public debt 59
3.4 Ricardo’s policy position: an hypothesis 64
3.5 Conclusion 69
vii
viii Contents
4 The Capital Levy Proposal: Implications for
Ricardian Method 71
4.1 Introduction 71
4.2 Equity 74
4.3 The pattern of investment 81
4.4 The rate of the levy 83
4.5 The payment schedule 84
4.6 Other considerations 86
4.7 Conclusion 88
5 Ricardo on Public Debt: the Question of Motive 91
5.1 Introduction 91
5.2 Ricardo’s personal financial interests 93
5.3 Interested parties 99
5.4 Ricardo’s criticism of the Sinking Fund 106
5.5 Conclusion 108
6 Ricardo and Modern Public Debt Theory 111
6.1 Introduction 111
6.2 Fiscal stimulation of aggregate demand 112
6.3 Ricardian Equivalence 115
6.4 Issues of taxation 119
6.5 Conclusion 120
7 Summary and Conclusion 123
Appendixes
A. British taxation, expenditure and public debt statistics 129
B. British public finance experience 1688–1823 133
Contents ix
C. Public debt theory before Ricardo 137
D. Capital levy proposals after World War I 139
E. Ricardo’s parliamentary voting record 143
F. Public debt issue in Britain 149
G. Ricardo’s colleagues and correspondents 151
Notes 157
Bibliography of Works Cited 173
Index 181