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U.S. Government Budget Deficits And The Crowding-Out Effect, Robert L. Poulsen Jr.

Honors Capstones

The major problem studied in this paper is the crowding-out effect. The purpose of this paper is to determine whether the crowding-out effect is occurring in the U.S., or around the world, because of U.S. government budget deficits. If it is, the way fiscal policy is handled in this country will probably need changing. To study the problem, interest rates within and outside the U.S. are examined to see if U.S. budget deficits affect them. The paper also looks at both sides of the issue to get a better understanding of what is happening. Research studied includes both popular press …