The Impact of Fiscal Policies on Consumers’ Spending

Posted: 18 Jun 2010

See all articles by Matthias Nnadi

Matthias Nnadi

Cranfield University - School of Management

Date Written: June 18, 2010

Abstract

The economic impasse experienced in the UK is being counteracted by aggressive fiscal policies geared toward encouraging spending on consumables. Using the retail price index and data obtained from the Office of Natural Statistics this paper assessed the effectiveness of the government’s fiscal measures to stabilize the economy through spending. The article developed a consumer spending model (CSM) and assessed it impact on intrinsic fiscal policies such as bank rate, inflation, percentage earnings increase and mortgage rate. The study finds bank rate and annual inflation as most significant factors in affecting consumer spending and suggests that fiscal measures targeted at reducing bank lending rates and controlling inflation should be the government’s policy priority.

Keywords: Bank Rate, Spending, Mortgage Rate

JEL Classification: G18, G21, G28

Suggested Citation

Nnadi, Matthias, The Impact of Fiscal Policies on Consumers’ Spending (June 18, 2010). Available at SSRN: https://ssrn.com/abstract=1626807

Matthias Nnadi (Contact Author)

Cranfield University - School of Management ( email )

Bedfordshire, MK43 0AL
United Kingdom

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
734
PlumX Metrics