Fiscal policy comparison of the United of America during First and Second World War

The diploma thesis focuses on fiscal policy of the United States of America during World War I and World War II, where the main subject of the analysis is the tax system, emission of war bonds and federal outlays. The theoretical part begins with the introduction of the basic principles of the fiscal policy theory and its effects on economic subjects. The following is a description of the main features of the war economy and the tools used by the federal government to intervene in the economy, with specific examples from the analyzed period. In the practical part of the thesis, there are examined budget laws introduced in each period with a focus on adjusting specific tax rates and their revenues to the federal budget. In the case of war bonds there is examination of individual campaign actions, essentials of issued bonds and their share in budget revenues which is closely connected with the development of the federal debt. The aim of this work is to compare individual fiscal policies focused on federal revenues and their use in federal expenditures, which financed the war economy. By comparing the various fiscal instruments and their income, the work answers the main research question as to whether the bulk of government spending during both conflicts was largely financed by debt. The results of the work suggest that the hypothesis is confirmed when the dominant instrument for financing government expenditures were government bonds aimed mainly at the public.