AP MacroeconomicsEconomic Systems & Schools of Thought
Supply-Side Economics
Supply-side economics argues that lower taxes and less regulation boost growth by increasing the incentive to work, save, and invest.
It focuses on shifting long-run aggregate supply right rather than managing demand. The Laffer curve suggests tax cuts can sometimes raise revenue by expanding activity. Critics question the size of those effects and warn of larger deficits.
Interactive graph
AD/AS Model →
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Study module
Aggregate Supply →
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