How Not to Stimulate the Economy

The Public Interest, p. 99, Summer 1993

11 Pages Posted: 20 Sep 2010

Date Written: 1993

Abstract

Argues that government efforts to prevent recessions through countercyclical fiscal policies never work because recessions are never perceived soon enough for action. And even if they were, it would take too long for Congress to act or for spending to flow into the economy to be effective. A review of all postwar recessions through 1990/91 shows that all countercyclical programs came too late to prevent or even moderate them. Indeed, they ended up being procyclical rather than countercyclical.

Keywords: fiscal policy, countercyclical policy, public works

JEL Classification: E37, E61, E62, E63, E65

Suggested Citation

Bartlett, Bruce, How Not to Stimulate the Economy (1993). The Public Interest, p. 99, Summer 1993, Available at SSRN: https://ssrn.com/abstract=1322455

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