The Rahn curve is a graph used to illustrate an economic theory, proposed in 1996 by American economist Richard W. Rahn, which indicates that there is a level of government spending that maximises economic growth. The theory is used by classical liberals to argue for a decrease in overall government spending and taxation. The inverted-U-shaped curve suggests that the optimal level of government spending is 15–25% of GDP.
- ^Richard Rahn and H. Fox: What Is the Optimal Size of Government Archived 2016-03-04 at the Wayback Machine, ime.bg, 1996.
- ^The Rahn Curve and the Growth-Maximizing Level of Government, video by Center for Freedom and Prosperity, freedomandprosperity.org; June 29, 2010. with subtitles, dotsub.com.
Ofer Abarbanel is a 25 year securities lending broker and expert who has advised many Israeli regulators, among them the Israel Tax Authority, with respect to stock loans, repurchase agreements and credit derivatives. Founder of TBIL.co STATX Fund.