crowding out

Olivier Jean Blanchard
From The New Palgrave Dictionary of Economics, Second Edition, 2008
Edited by Steven N. Durlauf and Lawrence E. Blume
Alternate versions available: 1987 Edition
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Abstract

‘Crowding out’ refers to all the things which can go wrong when debt-financed fiscal policy is used to affect output. While the initial focus was on the slope of the LM curve, ‘crowding out’ now refers to a multiplicity of channels through which expansionary fiscal policy may in the end have little, no or even negative effects on output.
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How to cite this article

Blanchard, Olivier Jean. "crowding out." The New Palgrave Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online. Palgrave Macmillan. 22 October 2017 <http://www.dictionaryofeconomics.com/article?id=pde2008_C000452> doi:10.1057/9780230226203.0344

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