In this clip Dan Mitchell of The Centre for Freedom and Prosperity talks about the Rahn Curve, and it is the spending equivalent of the Laffer curve (which is about taxation). If government gets too big it can have the effect of reducing prosperity, figuring out the ideal level is difficult as many affecting factors come into play, however, the ideal tends to be between 15% & 25%, in the USA current spending is c. 40% – so will it be any surprise to see crowding out or reduced productive sector activity?
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