What Is The Keynsian Multiplier Effect?

Targeted spending could have a Multiplier Affect as high as .8. If so, then the continued circulation of the money in the US Economy would have a far greater affect than just the initial spending. That is, $450-billion initially spent, in targeted areas would create $2,250-billion in Gross National Product.

The following video explains the Multiplier affect using a .8 Multiplier. 


This is a definite advantage for Tax Revenue. Because of what they call Marginal Profits, Presidents Kennedy and Clinton ran surpluses. These were -- by the way -- the only surpluses in the history of USA. Higher than average marginal profits were responsible for both surpluses.
 

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