The Case for Fiscal Policy

Philip Arestis and Malcolm Sawyer ()

Chapter 6 in Financial Developments in National and International Markets, 2006, pp 103-117 from Palgrave Macmillan

Abstract: Abstract The case for fiscal policy and for governments to manipulate on their budgets as appropriate with the specific objective of achieving high levels of employment arises from Kaleckian and Keynesian propositions. Put simply, the latter argue that no market mechanisms are in place to ensure that the level of aggregate demand is sufficient for high levels of economic activity (Kalecki, 1939; Keynes, 1936). Even so, many lines of argument have been developed to the effect that budget deficits and fiscal policy are ineffectual and/or have undesired (and undesirable) effects. Indeed, a great deal of work has been undertaken recently on the significance of fiscal consolidation. Countries only have to balance their budgets, run surpluses during the upswing, and expansion is in place (we have rehearsed and rejected many of these arguments in Arestis and Sawyer, 2003).

Keywords: Interest Rate; Monetary Policy; Central Bank; Fiscal Policy; Real Wage (search for similar items in EconPapers)
Date: 2006
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: The Case for Fiscal Policy (2003)
Working Paper: The Case for Fiscal Policy (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-52237-4_6

Ordering information: This item can be ordered from
http://www.palgrave.com/9780230522374

DOI: 10.1057/9780230522374_6

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().