CH07FISCALPOLICY打印稿.PPT

1、.1ch07 fiscal policy.2nrefers to changes in government expenditures and/or taxes to achieve particular economic goals, such as low unemployment, price stability, and economic growth.ngovernment expenditures is the sum of government purchases and transfer payments.fiscal policy.3fiscal policynfiscal

2、policy influences saving, investment, and growth in the long run.nin the short run, fiscal policy primarily affects the aggregate demand.nwhen policymakers change the money supply or taxes, the effect on aggregate demand is indirectthrough the spending decisions of firms or households.nwhen the gove

3、rnment alters its own purchases of goods or services, it shifts the aggregate-demand curve directly.4changes in government purchasesnthere are two macroeconomic effects from the change in government purchases: nthe multiplier effectnthe crowding-out effect.5the multiplier effectngovernment purchases

4、 are said to have a multiplier effect on aggregate demand.neach dollar spent by the government can raise the aggregate demand for goods and services by more than a dollar.nthe multiplier effect refers to the additional shifts in aggregate demand that result when expansionary fiscal policy increases

5、income and thereby increases consumer spending.6the multiplier effectquantity ofoutputpricelevel0aggregate demand, ad1$20 billionad2ad31. an increase in government purchasesof $20 billion initially increases aggregatedemand by $20 billion . . . 2. . . . but the multipliereffect can amplify theshift

6、in aggregatedemand.copyright 2004 south-western.7a formula for the spending multipliernthe formula for the multiplier is:multiplier = 1/(1 - mpc) if the mpc is 3/4, then the multiplier will be:multiplier = 1/(1 - 3/4) = 4nin this case, a $20 billion increase in government spending generates $80 bill

7、ion of increased demand for goods and services.8the crowding-out effectnfiscal policy may not affect the economy as strongly as predicted by the multiplier.nan increase in government purchases causes the interest rate to rise.na higher interest rate reduces investment spending.nthis reduction in dem

8、and that results when a fiscal expansion raises the interest rate is called the crowding-out effect.nthe crowding-out effect tends to dampen the effects of fiscal policy on aggregate demand.9the crowding-out effectquantityof moneyquantity fixedby the fed0interestratermoney demand, mdmoneysupply(a) t

9、he money market3. . . . whichincreasestheequilibriuminterestrate . . . 2. . . . the increase inspending increasesmoney demand . . . md2quantityof output0pricelevelaggregate demand, ad1 (b) the shift in aggregate demand4. . . . which in turnpartly offsets theinitial increase inaggregate demand.ad2ad3

10、1. when an increase in government purchases increases aggregatedemand . . . r2$20 billioncopyright 2004 south-western.10changes in taxesnwhen the government cuts personal income taxes, it increases households take-home pay.nhouseholds save some of this additional income.nhouseholds also spend some o

11、f it on consumer goods.nincreased household spending shifts the aggregate-demand curve to the right.11automatic stabilizersnautomatic stabilizers are changes in fiscal policy that stimulate aggregate demand when the economy goes into a recession without policymakers having to take any deliberate act

12、ion.nautomatic stabilizers include the tax system and some forms of government spending.nexamples:nincome taxnunemployment insurancenwelfare.12discretionary fiscal policyndiscretionary fiscal policy is deliberate changes of government expenditures and/or taxes to achieve particular economic goals.na

13、utomatic fiscal policy is changes in government expenditures and/or taxes that occur automatically without (additional) congressional action.13discretionary fiscal policynexpansionary fiscal policy refers to increases in government expenditures and/or decreases in taxes to achieve macroeconomic goal

14、s.ncontractionary fiscal policy attempts to decrease government expenditures and/or increases in taxes to achieve macroeconomic goals.14fiscal policy and full employmentp1y1p real gdpduring a recession, the government can stimulate the economy by increasing government spending or decreasing taxes.ad

15、1ad2yplrassrasp2.15fiscal policy and price stabilityp2ypp real gdpduring an inflationary period, the government can contract the economy by decreasing government spending or increasing taxes.ad2ad1y1lrassrasp1.16two key assumptionsnin our discussion of fiscal policy, we only deal with discretionary

16、fiscal policy.nwe assume that any change in government spending is due to a change in government purchases and not to a change in transfer payments.17demand-side fiscal policyna change in consumption, investment, government purchases, or net exports can change aggregate demand and there fore shift t

17、he ad curve.na change in taxes can affect consumption or investment or both and there for can affect aggregate demand.18factors that change aggregate demand.19fiscal policy: a keynesian perspective.20keynesian theory & crowding outnin keynesian theory, expansionary fiscal policy shifts the aggregate

18、 demand curve to ad2 and moves the economy to point 2.nif there is no crowding out, expansionary fiscal policy increases real gdp and lowers the unemployment rate.nif there is incomplete crowding out, expansionary fiscal policy increases real gdp and lowers the unemployment rate, but not as much as

19、in the case of zero crowding out.nif there is complete crowding out, expansionary fiscal policy has no effect on the economy.21the new classical view of fiscal policy: crowding out with no increase in interest ratesnindividuals respond to expansionary fiscal policy, a larger deficit, and greater def

20、icit-financing requirements by thinking the following “a larger deficit implies more debt this year and higher future taxes. ill simply save more in the present so i can pay the higher future taxes required to pay interest and to repay principal on the new debt. but, of course, if im going to save m

21、ore, ill have to consume less.”current consumption will fall as a result of expansionary fiscal policy.deficits do not bring higher interest rates.22lags and fiscal policythe data lagthe wait-and-see lagthe legislative lagthe transmission lagthe effectiveness lagsome economists argue that discretion

22、ary fiscal policy is not likely to have the impact on the economy that policymakers hope. by the time the full impact of the policy is felt, the economic problem it was designed to solve may no longer exist, may not exist to the degree it once did, or it may have changed altogether.23lags and fiscal

23、 policy.24demand-side fiscal policy: return to the keynesian modelit would seem that under the conditions of no lags and zero crowding out, expansionary fiscal policy either increasing government spending or cutting taxes will work at removing the economy from a recessionary gap.25demand-side fiscal

24、 policy: return to the keynesian modelif government knows the difference between q1 and qn (so that it knows how much to change real gdp) and it knows the mpc, then it can use fiscal policy to get the economy out of a recessionary gap and producing natural real gdp.26demand-side fiscal policy: retur

25、n to the keynesian modelnif the government doesnt know the actual mpc and it doesnt know the actual difference between q1 and qn, then fiscal policy isnt likely to work as intended.27supply-side fiscal policynall other things held constant, lower marginal tax rates increase the incentive to engage i

26、n productive activities relative to leisure and tax avoidance activities.nmarginal tax rate = ( tax payment)/( taxable income)ngiven a cut in marginal tax rates two things will happen: individuals will have more disposable income; the amount of money they can earn by working increases.nin the analys

27、is of marginal tax rates and aggregate supply, we implicitly assume that in the aggregate, a marginal tax rate cut increases work activity.28the predicted effect of a permanent marginal tax rate cut on aggregate supply.29the laffer curve: tax rates and tax returnsnif income tax rates were lowered, would it increase or decrease tax revenue?nthere are two tax rates at which zero tax revenues will be c