The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature
The objective of this research is to identify, in the economic literature, the main factors which constrain the transmission of the fiscal shocks to the real economy. The interest in finding the most efficient fiscal stimuli in recovery the economies passing through crisis period has got increased a...
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| Format: | Article |
| Language: | English |
| Published: |
General Association of Economists from Romania
2010-11-01
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| Series: | Theoretical and Applied Economics |
| Subjects: | |
| Online Access: |
http://store.ectap.ro/articole/527.pdf
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| _version_ | 1811310283593875456 |
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| author | Marius-Corneliu MARINAŞ |
| author_facet | Marius-Corneliu MARINAŞ |
| author_sort | Marius-Corneliu MARINAŞ |
| collection | DOAJ |
| description | The objective of this research is to identify, in the
economic literature, the main factors which constrain the transmission of
the fiscal shocks to the real economy. The interest in finding the most
efficient fiscal stimuli in recovery the economies passing through crisis
period has got increased as soon as the expansionary monetary policy
promoted by most of the central banks has not generated an increase of
the confidence in the private economic agents and, as a consequence, an
increase of consumption and of the private investments. Even though it
represents the Keynesian solution for recovery the economies which have
been affected by the crisis, the fiscal expansion promoted during the
recession periods does not generate the same expected positive effects
any more (increase of consumption, significant decrease of
unemployment, increase of revenues in economy), as they are conditioned
by the reaction of the private economic agents to the fiscal stimuli. For
example, the decision to decrease taxation may not automatically
generate the significant increase of consumption (a condition for
spreading the multiplier effect in economy), under the terms of pessimism
or of the difficulty to access loans. As a result, the fiscal multipliers tend
to be rather proper, and their value decreases more during the deep
economic recession periods. |
| first_indexed | 2024-04-13T09:56:27Z |
| format | Article |
| id | doaj.art-3f7415d15f554e8690cd93ecb1cdc825 |
| institution | Directory Open Access Journal |
| issn | 1841-8678 1844-0029 |
| language | English |
| last_indexed | 2024-04-13T09:56:27Z |
| publishDate | 2010-11-01 |
| publisher | General Association of Economists from Romania |
| record_format | Article |
| series | Theoretical and Applied Economics |
| spelling | doaj.art-3f7415d15f554e8690cd93ecb1cdc8252022-12-22T02:51:23ZengGeneral Association of Economists from RomaniaTheoretical and Applied Economics1841-86781844-00292010-11-01XVII1118418678The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic LiteratureMarius-Corneliu MARINAŞ0 Bucharest Academy of Economic Studies The objective of this research is to identify, in the economic literature, the main factors which constrain the transmission of the fiscal shocks to the real economy. The interest in finding the most efficient fiscal stimuli in recovery the economies passing through crisis period has got increased as soon as the expansionary monetary policy promoted by most of the central banks has not generated an increase of the confidence in the private economic agents and, as a consequence, an increase of consumption and of the private investments. Even though it represents the Keynesian solution for recovery the economies which have been affected by the crisis, the fiscal expansion promoted during the recession periods does not generate the same expected positive effects any more (increase of consumption, significant decrease of unemployment, increase of revenues in economy), as they are conditioned by the reaction of the private economic agents to the fiscal stimuli. For example, the decision to decrease taxation may not automatically generate the significant increase of consumption (a condition for spreading the multiplier effect in economy), under the terms of pessimism or of the difficulty to access loans. As a result, the fiscal multipliers tend to be rather proper, and their value decreases more during the deep economic recession periods. http://store.ectap.ro/articole/527.pdf fiscal policyfiscal multipliersneo-Keynesianautomatic stabilizers |
| spellingShingle | Marius-Corneliu MARINAŞ The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature Theoretical and Applied Economics fiscal policy fiscal multipliers neo-Keynesian automatic stabilizers |
| title | The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature |
| title_full | The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature |
| title_fullStr | The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature |
| title_full_unstemmed | The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature |
| title_short | The Effectiveness of Fiscal Policy in Combating Economic Crisis. An Analysis Based on the Economic Literature |
| title_sort | effectiveness of fiscal policy in combating economic crisis an analysis based on the economic literature |
| topic | fiscal policy fiscal multipliers neo-Keynesian automatic stabilizers |
| url |
http://store.ectap.ro/articole/527.pdf
|
| work_keys_str_mv | AT mariuscorneliumarinas theeffectivenessoffiscalpolicyincombatingeconomiccrisisananalysisbasedontheeconomicliterature AT mariuscorneliumarinas effectivenessoffiscalpolicyincombatingeconomiccrisisananalysisbasedontheeconomicliterature |