Discretionary Policy versus Non-Discretionary Policy in the Economic Adjustment Process

Emil Dinga (), Cornel Ionescu () and Elena Padurean
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Emil Dinga: Center for Financial and Monetary Research “Victor Slăvescu”, Romanian Academy

Journal for Economic Forecasting, 2010, issue 4, 184-207

Abstract: The study aims to examine the concept of automatic fiscal stabilization in the context of macroeconomic adjustment policies. To this end, first a conceptual distinction between discretionary public adjustment policies and non-discretionary ones is achieved. Second, sufficient and necessary attributes for an automatic fiscal stabilizer are identified and examined, in order to obtain a definition of this instrument. The whole research approach is characterized by a logical and abstract way of thinking, to provide a general and non-contextual result. Finally, a general mechanism of action of automatic fiscal stabilizers is proposed, by introducing the basic concepts of action base and of action rate of such an instrument.

Keywords: sustainability; fiscal policy; automatic fiscal stabilizers; discretionary versus nondiscretionary; principle of the minimal action (search for similar items in EconPapers)
JEL-codes: E62 E63 H3 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:rjr:romjef:v::y:2010:i:4:p:184-207

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