Public Finance and Economic Growth: The Case of Holland in the Seventeenth Century

• 成果类型: Article
• 署名作者: Utrecht University
• 刊物名称: JOURNAL OF ECONOMIC HISTORY
• ISSN/ISSBN: 0022-0507
• DOI: 10.1017/S0022050711000015
• 发表日期: 2011
• 页码: 1-39
• 关键词: debt; revolution; Europe; constitutions; GOVERNMENT; MARKET

摘要

The debate over the institutions that link economic growth to public finance tends to disregard the need for savings to finance growing public debt. In seventeenth-century Holland the structure, size, and issuing rates of the debt were determined by investors' preferences, wealth accumulation, and changing private investment opportunities. The growth of savings enabled the creation of a huge debt largely with short-term bills. Issuing rates dropped because savings outstripped private investment alternatives. In Holland, and probably elsewhere as well, credible commitment and efficient fiscal institutions were necessary, but not sufficient to create liquid secondary markets and low costs of capital.