Government Debt in Economic Thought of the Long 19th Century
Freie Universität Berlin, School of Business & Economics Discussion Paper No. 2013/4
31 Pages Posted: 17 May 2013
Date Written: April 24, 2013
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: Suggested Citation