The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Pump Priming

  • Leon H. Keyserling
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_1423

Abstract

The expression ‘pump priming’ gained nationwide vogue during the Roosevelt New Deal 1933–9. It referred to US Government spending accompanied by deficit financing to promote economic recovery from the Great Depression, which peaked in 1933 at an unemployment rate of 24.9 per cent and GNP about 30 per cent below 1929 in real terms. The expression suited F.D.R.’s political skills and innate economic and financial conservatism because so many people then used hand pumps and their experience was that pouring in a little bit of water for a short time started a copious and sustained flow in normal fashion. When the US started to become ‘the arsenal of democracy’ in 1940 and later on entered World War II, the use to the term ‘pump priming’ ended.

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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Leon H. Keyserling
    • 1
  1. 1.