UP Contractionary Fiscal Policy Discussion
by | Mar 12, 2022 | xngulfriregxf
Description
An expansionary fiscal policy is accomplished by increasing aggregated expenditures and aggregated demand through an increase in government spending (and investment). Relating to the longest government shutdown several years ago, I’m not sure whether we consider such shut downs as a temporary contractionary fiscal policy. If so, what would be the consequence to the economy even if it is temporary? Will it have long-run impact? It was hard to answer these questions at the time the shutdown happened, but now, we may have a clearer picture now to evaluate the long term effect if there is any. You may want to apply the concept developed in this
article
to this analysis.

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