tailieunhanh - Ebook Macroeconomics - A contemporary introduction (10th edition): Part 2

(BQ) Part 2 book "Macroeconomics - A contemporary introduction" has contents: Fiscal policy, federal budgets and public policy, federal budgets and public policy, banking and the money supply, banking and the money supply, international trade, international finance, economic development. | Find more at 11 Fiscal Policy • President Barack Obama claimed on February 17, 2010, that “it is largely thanks to the Recovery Act that a second depression is no longer a possibility.” The Japanese government cut taxes and increased spending to stimulate its troubled economy. These are examples of fiscal policy, which focuses on the effects of taxing and public spending on aggregate economic activity. What is the proper role of fiscal policy in the economy? • Can fiscal policy reduce swings in the business cycle? • hy did fiscal policy fall on hard times for a quarter W century, and what brought it back to life? • Does fiscal policy affect aggregate supply? • And how did the cash-for-clunkers program work out? Answers to these and other questions are addressed in this chapter, which examines the theory and practice of fiscal policy. © AP Photo/Damian Dovarganes In this chapter, we examine the role of fiscal policy in moving the economy to its potential output. We review . fiscal policy during the last century, and discuss limitations to its effectiveness. The Great Recession had a major impact on the economy. We’ll consider the fiscal response to that calamity. A more complex model of fiscal policy appears in the ­ ppendix to this chapter. a Topics discussed include: • Theory of fiscal policy • Limits of fiscal policy • Discretionary fiscal policy • Deficits, surpluses, then more deficits • Automatic stabilizers • Fiscal policy response to the Great • Fiscal policy in practice Recession 227 Copyright 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent .