Anonymous asked in Social ScienceEconomics · 10 months ago

Macro Economics question?

George Bush supported one. Barack Obama proposed one too. And Republicans and Democrats in both houses of Congress ended up passing two of them. With all this backing, surely economic stimulus packages must be good for the economy, right? Please read chapter 11 of your text and together with the information from the previous three chapters, discuss why there is such a great debate going on about the use of fiscal policy (using government spending and taxing powers) to solve economic problems.

2 Answers

  • Oiy
    Lv 6
    10 months ago

    Economists believe that the relationship between the quantity of money and inflation rate as the one in 1929 is gone. QE is used everywhere with or without discipline. There is no room for monetary policy anymore if the next depression is coming. So, only the greatness of fiscal policy is left. But you might not think that our politicians will be keen enough to use it to build infrastructure as suggested in the Keynesian model..

  • JuanB
    Lv 7
    10 months ago

    To get you started you have to read chapter 11 and the previous 3 chapters. OR you could post the 4 chapters here and hope we read them all for you and answer for lousy 2 Y!A points.

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