Citation:
Feldstein M. Rethinking the Role of Fiscal Policy. American Economic Review. 2009;May.
Abstract:
As recently as two years ago there was a widespread consensus among economists that fiscal policy is not useful as a countercyclical instrument. Now governments in Washington and around the world are developing massive fiscal stimulus packages, supported by a wide range of economists in universities, governments, and businesses.
Why has this change occurred? What are the principles for designing a potentially useful fiscal stimulus? And what will happen if the current fiscal stimulus fails?
Notes:
NBER Working Paper 14684 , January 2009