THE BUDGET DEFICIT AND ECONOMIC ACTIVITY (Deficyt budzetu panstwa i aktywnosc gospodarcza)

• Authors: Marcin Krawczyk
• Languages of publication: PL

Abstracts

EN

In economic theory the budget deficit policy is a controversial issue and economists dispute over its potency to stimulate the economy. In the case of deficit which results from increased budgetary expenditure the discussion concentrates on such issues as how lasting are the changes in employment, output and prices caused by deficit spending and to what extent the crowding-out effect would raise interest rates and lead to a reduction of households' expenditure. The influence of the deficit on economic activity is ambigious because much depends on what households do when new treasury bills flow into their portfolios. Economic crises make this influence quite uncertain as households' expectations tend to become unstable and their decisions unpredictable . In such a situation the success of the budget deficit policy depends on the ability of policy makers to moderate the behaviour of households.

Keywords

EN

BUDGET DEFICIT; DEBT NEUTRALITY; ECONOMIC ACTIVITY; PUBLIC DEBT; TOBIN'S Q CO-EFFICIENT.; WEALTH EFFECT

Discipline

• ECONOMICS: ECONOMICS

• Publisher: Komitet Nauk Ekonomicznych PAN, Polskie Towarzystwo Ekonomiczne
• Journal: Ekonomista
• Year: 2009
• Issue: 5
• Pages: 559-578
• Document type: ARTICLE

Contributors

author

Marcin Krawczyk

• Marcin Krawczyk, Szkola Glówna Handlowa w Warszawie, Katedra Teorii Systemów Ekonomicznych, al. Niepodleglosci 162, 02-554 Warszawa, Poland

Identifiers

CEJSH db identifier

09PLAAAA070123