Alvin Hansen

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The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Hansen, Alvin


Born Aug. 23, 1887, in Viborg, S. D.; died June 6, 1975, in Alexandria, Va. American neo-Keynesian economist.

Hansen received his postgraduate degrees from the University of Wisconsin. He taught economics at the University of Wisconsin (1915–16), Brown University (1916–19), the University of Minnesota (1919–37), Harvard University (1937), and the University of Bombay (India, 1957–58). He supported the bourgeois-reformist theories of the dual economy and the universal welfare state.

Hansen’s chief works were concerned with the theory and methodology of anticrisis regulation of the economy, economic dynamics, and economic growth. Hansen’s recommendations for easing cyclical variations and stimulating economic growth, based on a system of built-in stabilizers and compensating countermeasures and on programs of flexible budget regulation by means of expanding or reducing government expenditures and investments, were widely applied in the state-monopoly regulation of the economies of the USA and other capitalist countries. These measures, however, did not avert economic crises in the countries.

Taking into account the great significance of the economy of the USA within the capitalist world, Hansen concluded that the elimination of world economic crises depended on the continuous prosperity of the USA and on an increased role for international organizations, such as the International Monetary Fund and the International Bank for Reconstruction and Development (World Bank). The practical effect of Hansen’s recommendations was to provide financial support to monopolies during crises and depressions at the expense of the broad masses of taxpayers.


Economic Policy and Full Employment, 2nd ed. New York-London, 1947.
Monetary Theory and Fiscal Policy. New York, 1949.
A Guide to Keynes. New York, 1953.
Economic Issues of the 1960’s. New York, 1960.
The Dollar and the International Monetary System. New York, 1965.
In Russian translation:
Ekonomicheskie tsikly i natsional’nyi dokhod. Moscow, 1959.
Poslevoennaia ekonomika SShA. Moscow, 1966.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
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It first appeared in Harvard University economist Alvin Hansen's presidential address to the American Economic Association, in December 1938, and in his book published the same year.
By definition stagnation refers to the growing gap between the trends of GNP at full employment (potential output) and the actual GNP (realised output--According to Professor Alvin Hansen, there is a maladjustment between (S + T) and (I + G), and not merely between S and I as talked of before.
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During the Great Depression of the 1930s, the "secular stagnationists," led by Keynesian economist Alvin Hansen, argued that falling population growth and dwindling prospects for technological progress meant that "mature" economies could combat chronic underinvestment and unemployment only through massive government spending.
How different macroeconomics would have been today if Dillard had acted as the guide to American Keynesians instead of Alvin Hansen's (1953) Guide to Keynes, with its emphasis on the IS-LM interpretation.